SingPost Q1 operating profit tumbles 60% to S$3.4 million amid increased market pressure

[SINGAPORE] Singapore Post’s (SingPost) group operating profit for the first quarter ended Jun 30 came in at S$3.4 million, a 60 per cent year-on-year drop from S$8.4 million.

The decrease in operating profit comes on the back of increased market pressure and competition, said SingPost in a bourse filing on Friday (Aug 22).

Revenue fell 23.8 per cent to S$162.3 million compared with S$213 million in the year-ago period. The decline was largely attributed to the significant reduction in international deliveries.

The drop means SingPost’s profit margin was a mere 2 per cent. S&P Global Ratings downgraded its long-term issuer credit rating on SingPost to “BBB-” from “BBB” last month due to its high fixed operating costs.

Group operating expenses declined 22.7 per cent from S$204.6 million to S$158.2 million following the divestment of its Australia business in March this year.

The company is yet to appoint a new chief executive officer after having fired Vincent Phang last year over the mishandling of a whistleblower complaint.

Property leasing revenue, mainly comprising rental income from SingPost Centre, was stable, said the group. It added that the property assets business (including SingPost Centre) is also expected to remain stable.

The counter closed flat at S$0.50 on Thursday.