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S&P cuts SingPost's credit rating by a notch to A- with stable outlook
STANDARD & Poor's (S&P) has cut Singapore Post's long-term credit rating by a notch to "A-", from "A", with a stable outlook amid increased earnings volatility.
S&P has also trimmed its ratings for SingPost on the long-term Asean regional scale as well as the mail carrier's various outstanding debt.
The downgrade follows a Nov 6, 2015 decision by the credit ratings agency to place SingPost on CreditWatch with negative implications.
"We believe SingPost's transformation into a logistics and e-commerce provider will increase contributions from these businesses relative to its traditional postal business, increasing overall earnings volatility," S&P said in a report.
"Postal services have higher and more stable margins than the more competitive logistics and e-commerce segments, where SingPost's market position is less established."
In a statement, SingPost said that its credit rating remains strong among its peers.
"The company is financially disciplined in its approach to investments and manages business risk as a fundamental process of its transformation into an integrated end-to-end e-commerce logistics group with a stable postal platform," the company said.
"SingPost is committed to maintaining an investment-grade credit rating and the best long-term interest of its stakeholders."