SBS Transit Q2 profit up 52.9%

BUS and train operator SBS Transit on Wednesday posted a 52.9 per cent increase in second-quarter net profit to S$19.4 million, fuelled by higher operated mileage and rail ridership.  

For the three months ended June 30, earnings per share stood at 6.24 Singapore cents, up from 4.09 Singapore cents in the year-ago period. 

An interim one-tier tax-exempt dividend of 5.80 Singapore cents per ordinary share has been declared, to be paid out on Aug 27. This is up from 3.65 Singapore cents in the preceding financial year. 

Revenue for the quarter also rose 19.8 per cent to S$344.9 million. In particular, revenue from public transport services increased 20.3 per cent to S$330.1 million, mainly attributable to higher fees earned with the commencement of the Seletar Bus Package in March 2018, as well as the Downtown Line (DTL) 3 from October 2017, SBS said.

In addition, revenue from other commercial services rose 10.7 per cent to S$14.8 million, due mainly to higher advertising revenue with the commencement of DTL 3. 

These were however offset by lower average fare due to the fare reduction effective Dec 29, 2017.  

For the second quarter, average daily ridership for the DTL grew by 80.6 per cent to 437,000 passenger trips. Meanwhile, average daily ridership for North-East Line grew by 2.3 per cent to 579,000 passenger trips, and that for the Light Rail Transit by 8.1 per cent to 129,000 passenger trips as compared to last year. 

For the half-year to June 30, net profit rose 57.7 per cent to S$36.2 million, as revenue increased by 17.8 per cent to S$673.1 million. 

This translated to earnings per share of 11.63 Singapore cents for the six-month period, up from 7.38 Singapore cents a year earlier. 

Looking ahead, revenue from its public transport segment is expected to be higher from both bus and rail, SBS noted. 

Notwithstanding this, the rail business will continue to be challenging due to the fare reduction, as well as rising operating and maintenance costs. 

Added SBS: "Operating costs will be higher with higher staff costs following salary adjustments and increments. Repair and maintenance costs are expected to increase with DTL fully operational, and higher maintenance requirements as the bus and train fleets age."

Shares in SBS Transit closed at S$2.53 apiece on Wednesday, down 0.8 per cent, or two Singapore cents.