SMRT

Passengers evacuate smoky SMRT train at Dover station

AsiaOne
Friday, Jul 22, 2011

SINGAPORE - Thick smoke on an SMRT train resulted in an evacuation of passengers at the Dover station on Friday evening.

http://www.asiaone.com/News/AsiaOne%2BNe...90554.html [Full Article]

Business Times - 28 Jul 2011

SMRT posts 8.9% fall in Q1 net profit

Company cites higher energy and staff and related costs

By SAMUEL EE

HIGHER energy costs were instrumental in SMRT Corp's net profit falling 8.9 per cent to $34.8 million for the first quarter ended June 30, 2011.

Singapore's biggest rail operator was also affected by higher staff and related costs, repairs and maintenance, and other operating expenses, although these were partially offset by lower depreciation.

Operating profit was 8.1 per cent lower at $42.4 million from a year ago even as Q1 revenue increased 7.5 per cent to $253.1 million mainly on higher rail and bus ridership.

The company also enjoyed higher contributions from the Circle Line, stronger taxi rental revenue as well as higher rental and advertising revenue, even as these were offset by a lower average fare for MRT and buses.

Earnings per share fell to 2.3 cents from 2.5 cents previously. No dividend will be declared for Q1.

Revenue from train operations rose 4.2 per cent to $135.0 million on higher ridership but operating profit slipped 18.6 per cent to $22.6 million mainly due to increased energy costs and staff and related expenses.

The group's electricity and diesel costs in Q1 had surged 32.7 per cent to $40.0 million, while staff and related costs rose 10.9 per cent to $84.6 million with the bigger headcount for Circle Line operations, increased train runs and the absence of Jobs Credit.

As for bus operations, Q1 revenue rose 3.4 per cent to $54.3 million mainly on higher ridership. But operating losses ballooned to $4.4 million from $770,000 in the corresponding period the previous year due to higher diesel cost.

Taxi operations fared better with rental revenue up 15 per cent to $21.0 million mainly with a larger average hired-out fleet.

But operating profit was down 36.8 per cent to $414,000 from $655,000 previously because of higher depreciation and insurance costs.

Q1 rental revenue was stronger, increasing 10.8 per cent to $19.2 million and enjoying a 10.9 per cent hike in operating profit to $15.0 million.

Meanwhile, revenue from SMRT's engineering and other services jumped 54.2 per cent to $14.0 million with the higher revenue from fleet maintenance and diesel sold to taxi hirers.

This included payment of $0.7 million received for Palm Jumeirah and recognised as revenue in the quarter.

Engineering's Q1 operating profit of $3.3 million is in contrast to the operating loss of $1.1 million in the previous corresponding quarter's, due mainly to the fact that no revenue was recognised in Palm Jumeirah while costs for the operation and maintenance there continued to be incurred.

SMRT shares closed half a cent higher at $1.88 yesterday.

SMRT may be able to increase fare because of high electricity cost. Can SMRT mitigate the staff cost?

circle line will be fully open on Oct, SMRT should be able to have better profit. and from 2007 til 2011, SMRT have invested around 100 million (before depreciation) in rolling stocks, assuming for circle line, as well as for upgrade of green/red lines. Maybe less capex can be expected from now on.

For Q3 will the a period of mixed sentiments.
The results are expected to continue being weak, due to the higher cost from opening of circle line and stagnant circle line ridership increase.
While on the other hand the prospect hasn't changed and full operation of circle line will bring in more revenue.

Depend on how the market reacts, this could be a good chance for interested holders to enter.

I wouldn't say current price is cheap from valuation point of view. But SMRT is a special type, it's so resilient and maybe should deserve a higher valuation.
A good estimation of reasonable price maybe at P/E=15 and yield at 4.5%

As the share price continues to weak, I'd keep my hold position for now.
(Vested)

There is hardly any point in buying SMRT at current prices for yield since Vicom offers similar yield with a much lower payout ratio. The key reason to buy is for the possibility of profit growth as circle line goes fully operational thereby attracting more people since more locations are accessible compared to the past. The fare hike should help their margins as well. Not sure about their overseas investments though.

(02-08-2011, 06:04 PM)iff Wrote: For Q3 will the a period of mixed sentiments.
The results are expected to continue being weak, due to the higher cost from opening of circle line and stagnant circle line ridership increase.
While on the other hand the prospect hasn't changed and full operation of circle line will bring in more revenue.

Depend on how the market reacts, this could be a good chance for interested holders to enter.

I wouldn't say current price is cheap from valuation point of view. But SMRT is a special type, it's so resilient and maybe should deserve a higher valuation.
A good estimation of reasonable price maybe at P/E=15 and yield at 4.5%

As the share price continues to weak, I'd keep my hold position for now.
(Vested)

How did you calculate the PE=15 and Yield=4.5%?

At today's close of $1.82, I'm getting PE=17.17 and Yield=4.67% using FY11 EPS=10.6ct and Div=8.5ct (1H=1.75ct ; 2H=6.75ct) ie. Yield hit your target but PE not yet. Something's not right with your figures or are you using different EPS and Div?

I think he means using P/E = 15 and yield at 4.5% to get a reasonable price.

http://motoring.asiaone.com/Motoring/New...92844.html


Friday, Aug 05, 2011
AsiaOne

1% increase in bus and train fares

The Public Transport Council (PTC) has approved a 1 per cent increase in bus and train fares starting Oct 8.

The fare hike is less than half of the maximum increase of 2.8 per cent allowed for 2011, which operators SBS Transit and SMRT Corp applied for in July.

For adult commuters using the ezlink card, the 1 per cent increase will mean paying two cents more per ride. For senior citizens with concessionary cards, one cent more, and for those paying with cash, 10 cents more. There will be no change to child and student fares.

PTC said the average fare increase translates to $0.15 a week, or about $8 a year, for the 85 per cent of commuters affected.

The start of the fare increase on Oct 8 coincides with the opening of the final 12 Circle Line train stations. This is expected to benefit commuters in cutting down journey distances and making fare savings, PTC said.

SMRT will also make adjustments to its discount scheme for morning travel. Currently, commuters who exit from designated stations in the city before 7.30am can enjoy a 10 cent fare discount. This will be tripled to 30 cents and the timing will be extended to before 7.45am.

Both operators will extend senior citizen concessionary hours to a full-day thoughout the week, a move welcomed by the PTC.

Senior citizens travelling on the North-East and Circle Lines will also have their fares adjusted down, to 4 cents more than rides on North-South and East-West lines over equivalent distances. The current fare differential ranges from 4 to 19 cents.

In its deliberations to adjust the fares, PTC said it took into consideration Singapore's economic outlook and the affordability of public transport.

A "reality check" on SMRT's and SBS Transit's ROTA, or Return on Total Assets - an indicator of profitability - was also performed.

In comparison with companies like Hong Kong's Transport International Holdings (KMB) and MTR, London's Stagecoach Group, Singapore's SembCorp and Singapore Post, which had ROTAs of 3 to 14.9 per cent, PTC said the transport operators' ROTAs "were not considered excessively high".

Based on submissions to PTC, SBS Transit registered a ROTA of 7.8 and 9.3 per cent in 2010 and 2009 respectively. SMRT, on the other hand, had a 11.2 per cent ROTA in 2010 and a 12.0 per cent ROTA in 2009.

adrianl@sph.com.sg

lose downtown line to SBS, is it really unexpected given circle line to SMRT and SBS only having one less busy north-east line?

What I find interesting is that, as soon as LTA announced who is the appointed operator for the Downtown line, and before SBS announced the good news via SGXnet, SMRT had already issued an SGX announcement to congratulate SBS. Don't you wish to have such warm and friendly competitor?