SMRT's Des does well - profits plunged 57%. Congrats.

[Confuseous]

SINGAPORE — Transport operator SMRTCorp said yesterday that second-quarter net profit more than halved from the same period last year, due mainly to higher staff, depreciation, repair and maintenance costs.

Net profit for the three months ending September was S$14.3 million — down 57.1 per cent from the year-ago period — even as revenue rose 5.3 per cent to S$296 million.



Staff costs surged 27 per cent to S$118.5 million after a wage-revision exercise in the fourth quarter and increased headcount, the firm said in a statement yesterday.

In March, SMRT revised the wage scales of all its non-executive staff and restructured certain terms and conditions of employment.

Turnover from its train business rose 3.9 per cent to S$160.5 million due to higher ridership, but operating profit fell 95.8 per cent to S$1 million.

Its bus business saw revenue rise 2.9 per cent to S$58.4 million, but the operating loss widened 6.4 per cent to S$7 million.

Its taxi business experienced a 2.3 per cent decline in income to S$32.4 million, but operating profit surged 55.1 per cent to S$2.1 million with higher rental from a newer fleet.

“The fare business remains challenging with the misalignment between fares and rising operating costs, and the continued absorption of fare concessions,” said SMRT.

Mr Desmond Kuek, SMRT President and CEO, added that the firm is still in discussion “with the authorities on details for a timely transition to a viable and sustainable model for the train and bus businesses”.

 

[looneytan]

No problem wat! Up fare lah, what the heck

 

[TheWhiteHorse]

Public transport should never be measured by profits in the first place.

 

[sleaguepunter]

the following from Kim Eng Securties

SMRT: Earnings Continue To Surprise On The Downside; Sell, $1.29 - TP $0.80
MRT SP | Mkt Cap USD1.6b | ADTV USD0.8m

SMRT reported a 57% decline in net income to SGD14.4m for 2QFY14. Profitability of the group’s fare based business continues to suffer from the lack of fare increase in an escalating cost environment. With reduced profitability for 1HFY14, SMRT lowered its interim dividend to 1.0 cent (FY13: 1.5 cents).
While a change to the business model appears imminent, we caution against turning positive on the stock as terms for the transition remains highly uncertain. Our key source of concern centres on the asset buyback terms for the existing rail lines that were awarded under the old rail financing regime. Hence, we opine that it is highly speculative to buy on hopes that the transition terms would be favourable to SMRT.
Maintain Sell with TP of SGD0.80. With structurally higher leverage and poor dividend yield support, we argue that SMRT should de-rate from its historical levels. Despite a 26% decline in its stock price over the past year, SMRT continues to trade at expensive valuations of 30x FY14E P/E and yields merely 1.6%.

 

[Leongsam]

That shows he's doing a good job of implementing the necessary upgrades to improve the quality and reliability of the train service.

Kudos to Desmond for concentrating on the core function of the SMRT instead of just trying to rake in profits.

 

[sleaguepunter]

That shows he's doing a good job of implementing the necessary upgrades to improve the quality and reliability of the train service.

Kudos to Desmond for concentrating on the core function of the SMRT instead of just trying to rake in profits.

hold your praises first... let the company show improve quality and reliability first.

 

[congo9]

That shows he's doing a good job of implementing the necessary upgrades to improve the quality and reliability of the train service.

Kudos to Desmond for concentrating on the core function of the SMRT instead of just trying to rake in profits.

Now he is just gathering yesterday's fats to plaster the leaner years of today and tomorrow. Good job Desmond !

 

[eErotica69]

Where is Topsai?

Can long this counter?

 

[tanwahp]

Kudos to Desmond for concentrating on the core function of the SMRT instead of just trying to rake in profits.

That is the right way - but SMRT has now made a negative impact on their shareholders.

The question is, whose bright idea was it to allow SMRT to become private and listed in the first place?

 

[escher]

No problem wat! Up fare lah, what the heck

What else is new?

Fucking generals must be paid even if they contribute nothing but fucking hotair
Their only use is their imaginary protection to Ah Loonie when the hooting start on him once his smear of shit on sole of shoe LKY go under the ghouls and demons

Biggest joke is the it will be the generals that will do the hooting on Loonie to get at the billions LKY stole from all of us

 

[PrinceCharming]

.....The question is, whose bright idea was it to allow SMRT to become private and listed in the first place?

Our multi-million $ ministar? or the most well-paid scholars who are only good at academic studies?

 

[enterprise2]

So last time record earnings due to them skimming on repairs and maintenance. Much clearer now!!

 

[B Man]

I must say its fair. Since the train rides are much quieter now. The cost spent on repairs and maintenance is good. The previous boss must have really skimped on the repair costs to up profits to meet KPI goals.

What I hope is they dont use this as a reason to up the costs again. As a public transportation, they should not be a profit center.

 

[STUCK_HERE]

he's doing well. He supposed to cut down on the retail biz that his predecessor emphasize

 

[enterprise2]

he's doing well. He supposed to cut down on the retail biz that his predecessor emphasize

They should all take a massive pay cut and the pay cut savings put into repair and maintenance works!!

 

[leetahbar]

maybe another good reason if they wanna bring back the money spinning bitch.

 

[congo9]

he's doing well. He supposed to cut down on the retail biz that his predecessor emphasize

He should be scaling up the retail parts of the business. He should be investing in property as well. Look at SPH. With so much resources to play around and he does not know how to make his shareholders happy, i think he should be stepping down.