SingPost announced their 1H FR today
The core business, mail segment's revenue increases by +8%. If exclude the newly integrated Novation business, revenue increases by +4%. Operating profit reduces marginally by -0.5%, the core business remains resilience, likely due to management's effort recently
The logistic segment's revenue increases by +8%, while operating profit increases +18%. The bulk of the increase is from Quantum Solution (QS), likely due to investment in resources to develop QS recently.
The retail segment's revenue continue to grow with new product/services introduced and productivity improvement. Revenue increases by +9%, while operating profit increases by +49%.
Operating expense remain a concern, its growth outpace the revenue growth.
The rental income decreases by -5%. IMO, SingPost does not focus enough on its property related income.
The S$300 million 10-year bond issued in April 2003 will due soon. After redeem the bond, the remaining cash reserve will reduce to approx $330m for further M&A activities.
Overall, the direction headed remain healthy IMO.
SingPost to Acquire Lock+Store
- Acquisition paves way for opportunity to extract greater value from its properties and
further expansion of its self-storage business
Singapore, 24 December 2012 - Singapore Post Limited (SingPost) today announced it
will acquire 100% stake in General Storage Company Pte. Ltd. (General Storage) from
Asia Pacific Storage Company Limited for S$37.0 million.
General Storage operates a self-storage business in Singapore, under the Lock+Store
brand. Its facilities are located in two separate locations, namely Tanjong Pagar and Chai Chee.
SingPost has been offering self-storage solutions through S3 (Self Storage Solutions)
since 2009. Located at SingPost’s own facility at Ayer Rajah which also houses one of its regional delivery bases, S3 provides a one-stop suite of integrated services spanning
warehousing, fulfilment, delivery and distribution. SingPost has a network of properties
including post offices and delivery bases.
Said Dr Wolfgang Baier, Group Chief Executive Officer of SingPost: “This acquisition is
part of SingPost’s transformation initiatives, enabling us to further expand our self-storage business S3, with an experienced and leading operator in this industry. As an extension of our business, self-storage solutions offer synergies with our existing business in logistics and e-commerce. We expect to further integrate the self-storage business into our core business by adding delivery and other value-added services to storage solutions. This strengthened expertise in self-storage solutions can also potentially benefit our regional partnerships.”
Mr Ng Hin Lee, Group Chief Financial Officer added: “Self-storage business is an
attractive usage option for the industrial-zoned space of our properties. This acquisition is strategic, paving the way for SingPost to extract greater value from our existing
properties.”
With this expanded service offering, SingPost will be able to better serve its individual and SME customers.
- End -
Consideration. Under the Agreement, the Company is to pay an aggregate
consideration of S$37,005,400 (the “Consideration”) for the Acquisition,
comprising S$15,604,060 for the ordinary share in the capital of GSC, and
S$21,401,340 for the assignment of shareholder loans made by the Vendor to the GSC Group, subject to certain earn-out adjustments after completion of the Acquisition. The Consideration was arrived at on a “willing buyer-willing seller” basis, taking into account, amongst others, an enterprise value of S$52,000,000 for the GSC Group, adjusting for the amount of loan indebtedness owing by the GSC Group to financial institutions. The Consideration will be satisfied wholly in cash, and will be funded from the Company’s internal resources.
Expected Completion Date. Completion of the Acquisition is expected to take place in the fourth quarter of the Company’s financial year ending 31 March 2013. Upon completion of the Acquisition, GSC will become a subsidiary of the Company.
Value of GSC
Based on the audited consolidated financial statements of GSC for the financial year ended on 31 December 2011 (being the latest available audited financial statements of GSC), the net asset value of GSC is S$1,992,758.
Lot of goodwill will be "struck" in the balance sheet unless the "fair value" of the company is much more than the net asset value of close to $2m. That's the accounting impact.
Interesting venture though.
This might be synergistic with its logistics business of which they have been focusing on as a growth area. You need much larger storage space unlike your mail, can this possibly help them increase their very low margin on logistics?
However, this might be a loss-making business since they did not disclose the profit and i remember Hersing's Storhub is also losing quite a bit of money at the moment.
(not vested)
S3 (Self-Storage-Solution) is a small part of SingPost business, park under logistic segment.
Synergistic with logistics is one point to observe in next few quarters...
Another interesting point is "extract greater value from our existing properties.”... IMO, the properties (both investment properties and within PPM) are under-utilized.
(vested)
I am not so interested on following the complain, but the reply in bold.
SingPost: We won't lose focus amid change
by Patsie Tan, Assistant Vice President, Corporate Communications, Singapore Post Updated 09:59 PM Jan 11, 2013
We refer to Mr Teo Hoon Seng's feedback in "SingPost needs to perform better" (Jan 6, online).
We are heartened that he appreciates the efforts of our customer service officer at Tiong Bahru Post Office, to whom we have conveyed his feedback.
We have investigated the matter. Our courier attempted to deliver Mr Teo's item and dropped a delivery advice in the letterbox, as there was no response or lift access.
Mr Teo contacted our hotline to request for a callback from a duty manager, and we regret that our hotline staff did not act on it promptly. We have counselled and reminded her of the importance of prompt follow-up. We apologise to Mr Teo for the inconvenience caused.
We thank him for understanding SingPost's need to diversify, and assure him that even as we are transforming our business, we will not lose focus on our core business and our service quality.
In Singapore, public mail volume has been declining by about five per cent year-on-year due to lifestyle changes and e-substitution. This trend is also observed globally.
SingPost cannot rely solely on mail business and needs to generate new revenue streams to continue providing an affordable postal service.
Earnings are reinvested into systems, technology and the maintenance of postal infrastructure, such as some 800 posting boxes, about 60 post offices and more than 300 Self-service Automated Machines to provide a convenient service to all.
We thank Mr Teo for the opportunity to clarify.
-- TODAYonline
http://www.todayonline.com/Voices/EDC130...mid-change
Another update from SingPost replying to complain. My focus is on the status update of service improvement since 2011, after the management actions.
IMO, consumers in Singapore are always unwilling to pay for higher service quality demanded. We should not expect paying normal mail postage, but expected registered mail service quality
The same situation for bus and/or rail's fare and service quality IMO
Complaints to SingPost fell 42% from 2011 to last year
by Patsie Tan, Assistant Vice President, Corporate Communications, Singapore Post 04:45 AM Jan 17, 2013
We refer to Mr Alex Huang's feedback in "Intervention needed to improve SingPost services" (Jan 7).
Upon receipt of his feedback late last month, our Inspector of Post (IP) attempted to personally trace the movement of Mr Huang's item in the operation process, although SingPost can only track registered mail.
Ordinary mail items, of which we process about three million daily, are not tracked. Our IP contacted Mr Huang and the recipient four days later to update them. We apologise for the inconvenience caused.
SingPost takes feedback seriously and, where necessary, will work closely with the relevant authorities in our investigation. We assure Mr Huang that, as Singapore's public postal licensee, SingPost takes our universal service obligations seriously and constantly invests in customer service.
Apart from investing in infrastructure such as the multipurpose sorting machine and three-wheeler vehicles, SingPost has implemented additional and more stringent quality checks, IT systems and measures to enhance service levels. Our investment in customer service has paid off, as the number of complaints received fell by some 42 per cent from 2011 to last year.
Singapore's quality of service standard is one of the most stringent in the world. We have been achieving over 98 per cent in next-working-day delivery. We will continue to work to improve and maintain high standards of mail service. We thank Mr Huang for his feedback.
-- TODAYonline
http://www.todayonline.com/Voices/EDC130...-last-year
Be realistic, at 26 Singapore cents delivered otherwise opt for $6 same day delivery by other operators. I believe this guy will still continue to use SingPost despite his complain.
(17-01-2013, 12:22 PM)edragon Wrote: [ -> ]Be realistic, at 26 Singapore cents delivered otherwise opt for $6 same day delivery by other operators. I believe this guy will still continue to use SingPost despite his complain.
Singaporean just like to complain. In any way, it also depend on the reliability of the delivery man in that estate too