Singapore Post

[kennynah]

i agree...singpost does not appear to be heading anyway lucrative.... core business of posting is no where near international standards' offerings. imo, shall remain the mama shop of postal delivery service providers.

[Rontan]

I think SingPost is more suitable for those "lazy" and "risk-adverse" investors. You can just buy and go to sleep without worrying too much whether the company will still be around 10 years from now. It also offers decent dividends yield of more than 6%, based on current price. Not too bad for those who has lots of cash but dunno where to invest and don't want the hassle of having to mointor the market constantly. I am 50% like such investor, that is, not much cash available but lazy to mointor the market too often Thats why I am a Singpost SH.

[blid2def]

It's not called lazy. It's called having different priorities.

[Rontan]

It's not called lazy. It's called having different priorities.

I think you are right. It for those who place "Laziness" as their top priorities..

[winston]

I have moved the various discussions on Yield plays into the "Dividends Stocks" thread.

[millionairemind]

January 30, 2009, 5.53 pm (Singapore time)

SingPost's net dips 0.5% to $36.6m
Firm warns of difficult times ahead

By CONRAD TAN

SINGAPORE Post's net profit slid 0.5 per cent to $36.6 million for the three months to end-December, compared with a year earlier, the firm said yesterday, as it warned of tough times ahead.

Revenue for its fiscal third quarter rose 1.6 per cent to $124 million, but the increase was offset by higher expenses, which grew 5.2 per cent to $89.3 million.

For the nine months to end-December, net profit for the postal services operator dipped 1.2 per cent to $113.5 million, despite a 3.4 per cent rise in revenue to $365.5 million.

It declared a tax-exempt interim dividend of 1.25 cents a share for the quarter just ended, to be paid on Feb 27.

'The outlook for business activities is expected to be poor in the next 12 months, given the rapidly worsening economic conditions,' it said.

'The challenging economic conditions will have an impact on the group's performance. In addition, the group expects margin pressure arising from the liberalisation of the basic mail services market and entry of new players.'

SingPost's share price ended 1.3 per cent lower at 77 cents.

[la papillion]

Singpost announced their 3Q08 results today. As usual, their results are just that...boring. It's not doing exceptionally well, nor terribly bad either. It's just plodding along, so to speak. A few pointers to take note:

1. 3Q08's operating profit falls 1.2% compared to 3Q07. However, if excluding all extraordinary items, the net profit for both 3Q results are nearly the same.

2. Comparing 9M08 to 9M07, the operating profit dropped a little too (0.7%). Again, excluding all extraordinary items, the net profit for 9M08 is a little better, being 7.5% above 9M07. As mentioned, Singpost's result is nothing spectacular but nothing to worry about too.

3. I noticed that for 3Q08, the selling expenses went up nearly twice as much (43.5%). However, the absolute amount is quite insignificant, being just around 4% of the total expenses incurred for the same quarter. It's stated that they provided more in terms of doubtful doubts in view of the bad times. Singpost do need to curb their expenses though. The revenue for this quarter is up 1.6% from the last year, but the expenses expanded by 5.2%. Of course, this naturally dragged down the net profit for the quarter.

4. Diluted EPS for the past 9M08 is 5.891 cents. Today's closing is 77 cts. Thus, the PE is 9.8x based on annualised EPS for the past 9 months. For singpost's standard, this PE is actually quite low already. Still, in this kind of times, sub-10 PE is quite the normal. Maybe even sub-5.

5. Current assets for this quarter is 1.05, compared to 0.90 last quarter. There is an increase in the percentage of cash/cash equivalents over the current assets this quarter. Singpost increased its cash/cash equivalents to current assets from 57% last quarter to the present 62%. Since they do not hold much inventories, quick ratio is pretty irrelevant here. In my opnion, nothing to worry about them being unable to meet short term debts.

6. Long term debts consists of unsecured bonds, expiring on 11th April 2013 with fixed interest rate of 3.13% pa. This bonds actually forms a huge part of their total liabilties (58.3%), so it's important to see how they are able to pay for it when the time comes. There are still 4-5 years more to go before it's due, so I don't think there's a concern about that now.

7. Cash flow from operations are still coming in (a total of 63 mil). I doubt they are going to go into any major investing in their PPE, so net cash should still be positive. The major outflow of cash comes from payment of dividends to shareholders. It's 'bleeding' 24 mil this quarter. Overall, there is around 29 mil of cash entering their coffer this quarter, bringing their total cash/cash equivalent to 131 mil. If they are going to pay a special dividend next quarter (which they normally do, usually to a tune of twice the quarterly dividend i.e. 2.50 cents per share), it'll take away around 48 mil.

Is it likely? I think so. The payment period of their bonds are still far away, and they are still getting in a good cashflow of 60+ mil. Then again, last quarter was the better quarter for Singpost due to the holiday seasons, so 4Q might be slower. Still, there's still a good chance for them to pay special dividends next quarter. Let's see how the situation goes. At least 1.25 cents per quarter is their dividend policy, based on my buy price, I should be 'guaranteed' a yield of at least 4.2% pa.

[kennynah]

so....Long or Short ?

[la papillion]

If you hold it, no need to dump it. If you didn't hold it, can don't buy it. If you are shorting it, aren't there better counters to do it?

[kennynah]

in other words....can sweep this counter under carpet for nong nong time...tio bo?