SBS Transit posts 67.3% fall in H2 profit

TRANSPORT operator SBS Transit posted a 67.3 per cent fall in net profit for the fiscal second half from a year ago, but the company said on Wednesday (Feb 23) that it only stayed in the black due to government reliefs amounting to S$21.7 million.

Net profit for the 6 months ended Dec 31, 2021 stood at S$15.2 million, compared with a net profit of S$46.4 million posted the same period a year ago.

Without the government reliefs, which comprise mainly of the Jobs Support Scheme, the group would have recorded an operating loss of S$6.3 million for the second half.

Revenue for the period went up 6.7 per cent to S$670 million from S$627.7 million for the same period in 2020, but higher operating costs, in part due to the cut of government reliefs by S$26.5 million, chipped away the gains.

SBS also incurred a one-off loss of S$16 million on the disposal of 241 buses in order to switch to more efficient younger buses from the Government, it said.

The group, however, noted that its S$643.9 million half year revenue from running public transport services grew by 5.7 per cent.

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SBS attributed the increase to higher service fees from higher fuel indexation and higher other operating income offset by lower rail revenue from lower ridership.

Its chief executive Cheng Siak Kian said the group continued to see low ridership on its buses and trains as people continued to work from home, nightlife remained non-existent and Covid-19 restrictions remained in force.

"While things may have improved compared to 2020, we are certainly not out of the woods," he said. "The situation remains fluid as new Covid-19 variants may emerge, we are both cautious and yet hopeful for a recovery."

In its financial statement, the group had noted that average daily ridership for the North-East Line fell by 5.4 per cent to 358,000 passenger trips, while that of the Downtown Line dropped by 5.5 per cent to 248,000 passenger trips compared to the second half of 2020.

Average daily ridership of the Sengkang and Punggol Light Rapid Transit also dipped by 0.5 per cent to 104,000 passenger trips, it added.

Meanwhile, it drew more revenue from providing other commercial services. The segment grew by 39.5 per cent to S$26.1 million, up from S$18.7 million the same period in 2020.

SBS said this was mainly due to higher advertising revenue mostly attributable to more rail and bus campaigns rolled out in line with gradual economic recovery, lower rental rebates given to tenants and higher other operating income.

Operating profit was also up 0.7 per cent to $12.2m due mainly to higher revenue offset by higher depreciation expenses and higher other operating costs, it said.

For the full year, the group's net profit fell by 34.6 per cent to S$51.6 million, from S$79 million in FY2020.

Based on existing share capital, the results translate to earnings per share of 16.56 Singapore cents, against earnings per share of 25.32 Singapore cents in FY2020.

The board has proposed a final tax-exempt one-tier dividend of 2.45 Singapore cents per share, payable on May 26 if approved by shareholders at an annual general meeting to be held on April 28.

This means that, together with the interim tax-exempt one-tier dividend of 5.75 cents paid earlier, the total dividend for 2021 would be 8.20 cents per share, SBS stated.

The counter closed up 1 per cent or S$0.03 at S$3 before the announcement.