Transformation efforts contribute to stable performance while SingPost Group continues to be under pressure with domestic mail volumes continued to decline for second consecutive year, compounded by escalating labour costs. The new subsidiaries and e-commerce related activities contribute to growth. Increasing cost pressures especially in Singapore, together with continued investment in service quality and productivity in Singapore.
In spite of the decline in the traditional postal business, SingPost Group revenue grew 5.9% in the 4Q of FY 2013/14, boosted by the full consolidation of new subsidiaries and the growth in e-commerce related businesses. Excluding contributions from the new subsidiaries, SingPost Group recorded organic revenue growth of 3%.
Domestic mail volumes continued to decline in 4Q, with the full year registering a reduction of 1.3%. However, overall Mail revenue grew 6.6% to S$123.4 million in the quarter, attributed to the increase in regional e-commerce transhipment business and inorganic improvement in direct mail revenue from Samplestore which was acquired in October 2013. For the full year, Mail revenue rose 11.5% to S$491.0 million.
Total expenses for 4Q increased 3.8% to S$170.0 million, attributed to the continued investment in resources for SingPost Group’s transformation, change in business model to a diversified group and growth in lower margin businesses. SingPost Group benefitted from the exceptional Government’s wage credit scheme which mitigated the increase in labour and related expenses due to additional headcount from the new subsidiaries. For the year, total expenses rose 26.4%.
Net profit increased 17.7% to S$30.7 million in 4Q. For the full year, net profit increased 4.8% to S$143.1 million. Excluding one-off items, underlying net profit declined 1.3% to S$31.4 million in the 4Q, while for the full year, it increased 2.9% to S$145.0 million.
The Board of Directors is recommending a final dividend of 2.5 cents per share for FY 2013/14. 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 FY 2013/14 would be 6.25 cents per share. The final dividend is payable on 18 July 2014.
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