SingPost Group s unaudited results for the fourth quarter and full year ended 31 March 2012

Transcription

1 For immediate release SingPost Group s unaudited results for the fourth quarter and full year ended 31 March 2012 Q4 revenue up 3.1% to S$146M, Full year up 2.2% to S$579M Performance impacted by industry challenges, business environment and cost pressures Significant investments to build business in SingPost s accelerated transformation Commitment to shareholders unchanged Singapore, 27 April 2012 Singapore Post Limited ( SingPost ) today announced its unaudited results for the fourth quarter and full year ended 31 March Below are some highlights. FINANCIAL HIGHLIGHTS Q4 FY11/12 Q4 FY10/11 Variance (%) Full Year FY11/12 Full Year FY10/11 Variance (%) GROUP RESULTS Revenue Rental & Property- Related Income (4.7) Total Expenses Net Profit (17.4) (11.8) Underlying Net Profit (23.1) (9.5) Net Cash from Operating Activities Earnings per Share cts cts cts cts Q4 performance impacted by industry challenges, difficult business environment and cost pressures - Group revenue up 3.1% to S$145.9M; net profit down 17.4% to S$30.6M For the quarter, Group revenue increased by 3.1% to S$145.9 million, underpinned by growth in Logistics and Retail & Financial Services. Mail revenue was steady at S$96.4 million, as growth in international mail and philatelic revenue offset the decline in domestic mail and hybrid mail contributions. Logistics revenue grew 8.2% to S$54.0 million on the back of higher Speedpost contributions and increased e-fulfilment activities in Quantium Solutions and vpost shipping business. Retail revenue rose 9.2% to S$18.2 million as increased contributions from financial services, retail products and online store Clout Shoppe offset the drop in agency services. Rental and property-related income declined by 4.7% to S$10.0 million with lower rental income from repurposed post office buildings. Total expenses were higher at S$123.7 million as the Group stepped up its investments in infrastructure including IT to drive its diversification and regionalisation efforts. Page 1 of 5

2 Net profit declined by 17.4% to S$30.6 million in the fourth quarter. Excluding one-off items, underlying net profit was S$26.8 million, a decrease of 23.1% from S$34.8 million in the same quarter last year. Commenting on the performance, Dr Wolfgang Baier, SingPost s Group Chief Executive Officer said: Revenue growth was offset by the generally weaker business environment as well as inflationary cost pressures. We saw a slowdown in Mail revenue in the domestic segment and in Logistics cross-border mail business under our subsidiary Quantium Solutions. In spite of that, our Logistics and Retail & Financial Services managed to grow through contributions from non-traditional revenue streams such as e-fulfilment, e-commerce and financial services. We continue to step up our investments to build a sustainable future for SingPost. Full year performance reflects Group s accelerated transformation efforts - Group revenue rose 2.2% to S$578.5M; net profit declined 11.8% to S$142.0M Revenue for the full year rose 2.2% to S$578.5 million, with growth driven by Logistics and Retail. Mail revenue was flat at S$385.4 million as growth in international mail, hybrid mail and philatelic revenues was offset by the decline in domestic mail contributions. In Logistics, revenue grew 8.6% to S$215.3 million, attributed to the increase in e-fulfilment activities. Higher contributions were recorded from Speedpost, Quantium Solutions, transhipment and vpost shipping businesses. Retail revenue rose 3.8% to S$69.4 million as growth in contributions from financial services and Clout Shoppe offset the decline following the sale of Speedcash business in March Rental and property-related income grew by 1.9% from S$41.6 million to S$42.3 million, with higher rental income from Singapore Post Centre. Total expenses rose by 7.8% from S$426.1 million to S$459.3 million. Approximately S$9.7 million was attributable to costs for upgrading of talent, IT systems and processes. Net profit fell 11.8% to S$142.0 million for the full year. Excluding one-off items, underlying net profit was S$135.4 million, a decline of 9.5%. Said Dr Baier: The postal landscape remained difficult during the year with e-substitution continuing to take its toll on our business. The unfavourable business environment - a slower economy, inflation and cost pressures from a tight labour market further exacerbated the situation. However, we saw opportunity for growth in e-commerce, e-fulfilment and regional logistics. The rise in e-commerce activities locally and in Asia has been promising and to tap this growing market, we have to respond fast and step up our investments to be ready for the future. A year with significant investments to build business in SingPost s accelerated transformation The difficult postal landscape and weaker business environment, coupled with increasing cost pressures, continued to pose challenges to the Group. In response to these challenges and market changes, SingPost rolled out its accelerated transformation programme built on 5 key business pillars Mail, Digital Services, Logistics, e-commerce and Retail & Financial Services. Page 2 of 5

3 Said Dr Baier: For SingPost, FY2011/12 can be characterised as the watershed year in our transformation journey as we made significant investments to capitalise on the opportunity to build our business. During the year, we invested in capabilities and resources in areas such as people, IT and operations and the results revenue growth in our non-postal business namely Logistics and Retail, in spite of the challenging conditions - show that we are on the right track. Ready for the Future SingPost s transformation programme, Ready for the Future, comprises 20 corporate-wide initiatives and projects to drive growth organically and inorganically, both in the domestic and regional markets. These initiatives include cost management and productivity projects as well as growth projects. For Mail, the focus is on innovation and productivity to stay relevant in the face of changing demands and to keep our operations efficient. During the year, SingPost developed new services to cater to the growth in e-commerce packets, e.g. epac, a service collaboration with ebay and USPS. Other new services in the pipeline include SMS confirmation for letterbox delivery and post-a-card, a mobile application that converts the sender s selected photo into a physical postcard and delivered to anywhere in the world. In Digital Services, SingPost has been developing its own digital mailbox, vbox, to provide customers with an alternative or supplementary communication platform. SingPost is expanding its digital services into the region through its wholly-owned subsidiary DataPost which provides business process outsourcing (BPO) services ranging from secured printing to letter-shopping to delivery to document management as well as mailroom management. During the year, SingPost made a strategic investment in Efficient E-Solutions and announced that it was in the process of acquiring Novation Solutions in Hong Kong through DataPost, to further grow its BPO services. Under Logistics, the Group is focused on strengthening its regional e-fulfilment network by leveraging Quantium Solutions as well as its regional associates namely GD Express in Malaysia, Indo Trans Logistics Corporation in Vietnam and Shenzhen 4PX Express in China. During the year, the Group invested significantly in building capabilities in the areas of people, technology and operations as it transforms Quantium Solutions from a cross-border mail service provider to a total logistics solutions and e-fulfilment provider with many new regional customers coming onboard. For e-commerce, the Group is extending its presence in the online retail space with its luxury store Clout Shoppe and its shipping and shopping portal, vpost. Service offerings have been extended to fast-growing regional markets such as China and India through partnership and strategic acquisitions. The Group also introduced enabling services such as EZsuite, an online portal, to serve the SME market venturing into e-commerce. In Retail & Financial Services, the focus is on innovation and productivity. New services were introduced during the year including transactional banking services and additional government services. The Group is looking to expand its distribution channels with mobile application services and more self-help services and is also reaching out to SMEs. To finance new investments as part of its growth strategy, the Group raised S$350 million from the issue of Senior Perpetual Cumulative Securities in March It will also use the proceeds to fund anticipated capital expenditure and working capital requirements. Page 3 of 5

4 Focus on increasing productivity, innovation and service quality SingPost has been investing considerably in productivity throughout the years, from deploying automation to adapting operations and processes to leveraging technology. Productivity enhancements have helped the Group to manage labour cost increases as well eg SingPost s new multi-purpose sorter that can handle 10,000 packets/publications per hour compared to 700 pieces per hour by manual sorting. As an inclusive employer, SingPost is committed to increase productivity for the benefit of its workforce as well. Such investments have also improved customer service tremendously as complaints dropped more than 50% during the year-end festive period. Said Dr Baier: Clearly, as the Group transforms to stay relevant, we have to invest even more into productivity and innovation. Among others, the Group is introducing a web-based booking tool which will not only improve productivity and efficiency, but will also enhance customer experience. It is also exploring an island-wide automated delivery and collection system and other new technologies to meet changing customer needs. Domestic market remains very important and a focus area for the Group Even as the Group extends its business into the region, Dr Baier reiterated that the Singapore market remains an important one for SingPost: Singapore contributes more than 80% of total revenue and is an important market for us. We are committed to our social obligations and quality of service standards, and are continually investing in process improvements, additional resources as well as product and service innovations to serve our domestic customers. Commitment to shareholders unchanged Rounding up, Dr Baier said: It is no longer an option for us to conduct business as usual. We are redefining and transforming our business at an accelerated pace to stay relevant. This needs investments and time. Shareholders can be assured that we are committed to not only protecting their interests but to also enhancing value in the longer term. We are investing now to be ready for the future. The Board of Directors is recommending a final dividend of 2.5 cents per share for FY2011/12. Together with the interim dividend payments of 1.25 cents per share for each of the first three quarters of the financial year, the proposed total dividend for FY2011/12 would be 6.25 cents per share. The final dividend is subject to shareholders approval at the 20 th Annual General Meeting. End Page 4 of 5

5 About Singapore Post Limited (Reg. No M) Singapore Post Limited (SingPost) is a leading provider of mail, logistics and retail solutions in Singapore and the Asia Pacific region. It is the designated Public Postal Licensee (PPL) for Singapore providing domestic and international postal services as well as end-to-end mail solutions such as data printing, letter-shopping, delivery and mailroom management. As a logistics provider, SingPost offers domestic and international door-to-door delivery services, including express delivery (Speedpost) along with warehousing, fulfilment and distribution services. SingPost owns one of the largest retail distribution networks in Singapore with its extensive tri-channel network of post offices, Self-service Automated Machines (SAM) and the online shopping and shipping portal vpost. SingPost was listed on the Main Board of the SGX-ST on 13 May The company has won many awards and accolades. It is the only postal company in the world to have won the Express Mail Service (EMS) Cooperative Certification Gold Level Award by the Universal Postal Union for its Speedpost Worldwide Courier Service for 10 consecutive years since It was also named runners-up in the Most Transparent Company Award 2011 for the sixth consecutive year in the SIAS Investors Choice Awards. ~~~~~~~~~~ For general information on SingPost, call 1605 toll-free or visit Media contact Analyst contact Tay Poh Choo, Corporate Communications Selena Chong, Investor Relations Tel / Tel / Page 5 of 5