- ComfortDelGro's 1Q25 operating earnings rose 45% y-o-y to S$81.5mil. Excluding acquisitions, operating earnings rose 27.5% y-o-y, due to a significant turnaround in the UK – operating earnings spiked from S$0.9mil to S$8mil with the renewal of London bus routes and the contribution from the new Metroline Manchester contract.
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The Positive
Stellar turnaround in UK.
- Excluding acquisitions, UK operating profits spiked from S$0.9mil to S$7.9mil. The jump is due to the maiden contribution of the Manchester bus contract and the re-pricing of legacy low-margin London bus contracts.
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The Negative
High capital expenditure.
- While the UK has enjoyed a significant turnaround in operations, there is an accompanying need to invest in new buses. Capex jumped from S$68mil to S$306mil in 1Q25. Almost 60% of the capex is on 452 buses for the Metroline Manchester contract.
- The UK is also converting more buses to EVs.
Outlook
- Read more at SGinvestors.io.
