Growth in the Logistics segment was partly offset by the decline in the PP business.
SingPost's 1HFY23 results missed expectations
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Despite the increase in revenue, operating profit declined 19.1% y-o-y to S$41.3m while the bottom line turned into a loss of S$9.9m in 1HFY23. Excluding the impact of exceptional items, underlying net profit would have fallen 64.7% y-o-y to S$13.2m. The decline was mainly attributable to weaker performance in the PP segment, higher operating expenses and lower share of profit of associated companies and joint ventures.
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Post & Parcel (PP) segment likely to remain challenging in the near-term
The Post & Parcel (PP) segment remained weak, although there was some improvement in 2Q over 1Q. Revenue for both international (IPP) and domestic (DPP) business declined by 24.3% and 12.0% in 1HFY23. Operating income reported a loss of S$12.1m in 1HFY23, due to lower revenue and higher operating costs.
IPP’s revenue was weighed down by air conveyance rates which remained elevated albeit moderating, together with supply chain disruption from Chinese cities lockdown.
In DPP, PP business continued to decline as expected and domestic eCommerce logistics decreased 24.5% y-o-y in 1HFY23, largely due to a major eCommerce customer who has insourced parts of its logistics.
Logistics segment now makes up SingPost’s largest segment
Read more at SGinvestors.io.
Above is an excerpt from a report by OCBC Investment Research. Clients of OCBC Securities may be the first to access the full PDF report @ https://www.iocbc.com/.
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