SingPost reports 39% drop in Q3 earnings

SINGAPORE Post (SingPost) saw a 39.3 per cent slump in net profit to S$30.5 million for its third quarter ended Dec 31, 2019, from S$50.2 million a year ago.

This was due to an absence of the prior year's significant exceptional gains, the postal service provider said in a bourse filing on Friday before trading hours.

The absence of losses from its US subsidiaries compared to the corresponding period a year ago was offset by lower profit in the post and parcel business segment due to lower domestic letter volumes.

Excluding the impact of exceptional items, underlying net profit was down 5.1 per cent on the year to S$31.2 million for the third quarter, from S$32.9 million.

Earnings per share stood at 1.19 Singapore cents for Q3, down 42 per cent from 2.06 cents in the year-ago period.

Group revenue inched down by 2 per cent to S$355.9 million for the quarter from S$363.4 million a year ago, largely due to an accelerated decline in domestic letter volumes, as well as weak performance in the freight forwarding business.

This was despite the highest quarterly revenue of S$148 million ever achieved by the international post and parcel business, which was insufficient to offset the declines, SingPost said.

An interim dividend of 0.5 Singapore cent per ordinary share was declared for the quarter, the same as a year ago. It will be paid on Feb 28, after books closure on Feb 20.

Paul Coutts, group chief executive officer, said on Friday: "Even though e-commerce related deliveries have shown strong growth, we are seeing these benefits being eroded by the decline in letter mail volumes."

"As part of our response to the decline of domestic letter mail volumes, we will continue with our 'Future of Post' strategy to reposition ourselves and transform Singapore's postal landscape. We expect to commence trials of our new technology in the coming months," he added.

SingPost shares were trading flat at S$0.90 as at 9.33am on Friday, after the results were announced.