Decent performance by most SGX-listed companies so far

Singapore

COMPANIES listed on Singapore Exchange (SGX) have put on a fairly decent showing for the first-quarter earnings season so far, with 67 of the 76 firms that released their results as at Friday, 5pm, chalking up profits.

Still, the combined group profits came in at S$3.43 billion, down 11 per cent over the same period last year, based on data compiled by The Business Times. All companies had year-on-year profit comparisons.

Thirty-three companies - about half of those profit-making ones - raked in higher earnings, while 32 companies saw lower profits and another two swung into the black after making losses.

For the first three months ended March 31, 2016, nine of the 76 SGX-listed companies that had released their results by close of market on Friday posted losses.

Of those, four companies had swung into the red after making profits, four narrowed their losses and only one company chalked up higher losses.

However, uncertainty in the markets is expected to persist in coming quarters, said some analysts, who pointed to the volatile market conditions and tepid global economic data, even as oil prices rallied in April to their best showing in a month since May 2009.

So far, two of the three local lenders have demonstrated a soft start to the year.

Last week, United Overseas Bank (UOB) and OCBC Bank released their results, while DBS Group will announce its earnings for the first three months of the year on Tuesday.

UOB, the smallest of the three local banks, on Thursday posted a 4.4 per cent fall in net profit for Q1 2016 to S$766 million, largely in line with analysts' expectations. The slightly lower earnings are due to a rise in other operating expense and lower net gain from investment securities.

Both CIMB Research and KGI Fraser Research have adopted a cautious view of UOB's results, with the latter saying "we believe potential upside may be limited due to the weaker loan growth and expected flattish NIMs (net interest margins) in 2016".

On Friday, OCBC reported a net profit of S$856 million for Q1 2016, a fall of 14 per cent from a year ago as bad debt rose, loans fell and contribution from its insurance arm, Great Eastern, declined. The earnings in Q1 were below expectations, according to a Bloomberg poll.

Of the telcos, only M1 has released its results - a 7 per cent year-on-year decline in Q1 earnings to S$42.5 million, largely due to higher upfront customer acquisition cost. Singtel and StarHub will announce their results within these two weeks.

Among the real estate investment trusts (Reits), Sabana Reit is the only one so far that recorded a year-on-year decline in net income, while the three with the biggest year-on-year growth were Soilbuild Business Space Reit, Suntec Reit and First Reit.