SBS Transit posts 2.9% decline in FY2020 net profit to S$79m

TRANSPORT operator SBS Transit on Tuesday posted a full-year net profit of S$78.96 million, down 2.9 per cent from the previous year.

Its revenue for the full year ended Dec 31, 2020, also fell - by 14.8 per cent to S$1.23 billion.

Revenue from public-transport services in 2020 stood at S$1.20 billion, a 13.6 per cent decrease from 2019. This was mainly due to lower service fees from lower fuel indexation and operated mileage, coupled with lower rail ridership due to the pandemic.

Average daily ridership for the Downtown Line fell by 46 per cent in 2020 to 257,000 passenger trips. Its average fare, however, was higher by 11.7 per cent than in 2019.

For the North-East Line, average daily ridership also fell 40.9 per cent to 355,000 passenger trips; its the average fare also went up, by 13.9 per cent from 2019.

As for the Light Rail Transit, average daily ridership had fallen by 31.2 per cent to 97,000 passenger trips, with average fare increasing by 9.4 per cent.

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Total operating costs for the group fell 14.2 per cent in FY2020 to S$1.15 billion, with the biggest decrease coming from fuel and electricity costs, which fell 50.5 per cent.

Operating profit, which stood at S$79.98 million, would have sunk into the red with a S$29.81 million loss, had it not been for Covid-19 government reliefs. SBS Transit had received government grants of S$109.8 million, mainly from the wage subsidy from the Jobs Support Scheme.

The group said: "(The) government grants significantly cushioned the adverse financial impact due to Covid-19 where we experienced a significant drop in revenue from reduced ridership and operating mileage, rental rebates given to tenants and reduced advertising especially during the circuit-breaker period."

It added that while ridership has steadily improved, it has remained lower than in pre-pandemic days; other commercial services continued to be depressed.

Further, costs incurred for enhanced cleaning and disinfecting of buses, trains, interchanges, stations and depots, as well as for subsidising the cost of accommodation for Malaysian staff affected by the border closure and increased allowance for inventory obsolescence, contributed to higher operating costs.

Earnings per share for the group stood at 25.32 Singapore cents in FY2020, down from FY2019's 26.07 Singapore cents.

A final dividend of 6.30 Singapore cents has been recommended by the board. No interim dividend was paid. Last year, a final dividend of 5.90 Singapore cents and interim dividend of 7.15 Singapore cents was paid. The dividend will be payable on May 19, after books close on May 10.

SBS Transit said that while revenue from public transport services is expected to be higher than last year's in the absence of further circuit breakers, rail ridership recovery is expected to be gradual in Phase 3, as working from home continues to be the default mode.

However, revenue from other commercial services is expected to improve with higher ridership.

It added: "There is uncertainty over the easing of health and safety measures and the pace of a global vaccine rollout, hence the group continues to maintain a cautious outlook for the rest of the financial year."

Shares of SBS Transit closed flat at S$2.96 on Tuesday, prior to the results announcement.