Singapore Post Ltd. · SGX:S08
Singapore Post — H1 FY2020/21 Earnings Presentation
29 slides from Singapore Post's earnings presentation, Nov 6, 2020
Slide 1: Financial results H1 FY2020/21
Financial results H1 FY2020/21 6 November 2020 Confidential
Slide 2: Disclaimer
Disclaimer The following presentation contains forward looking statements by the management of Singapore Post Limited (“SingPost”) relating to financial trends for future periods, compared to the results for previous periods. Some of the statements contained in this presentation that are not histori
Slide 3: H1 FY2020/21 Financials
H1 FY2020/21 Financials Cash flow and Financial Indicators eCommerce Update Segmental Performance Strategy & Outlook Confidential
Slide 4: Resilient performance amid Covid-19 impact
Resilient performance amid Covid-19 impact Group P&L, S$M H1 FY19/20 H1 FY20/21 % change Led by growth in the Post and Revenue 645.6 707.8 +9.6% Parcel and Logistics segments, with strong eCommerce volume Operating expenses (567.6) (670.4) +18.1% growth across the Group Profit on Operating Activitie
Slide 5: Increase in expenses driven by volume growth, exacerbated by Covid-19 disruptions
Increase in expenses driven by volume growth, exacerbated by Covid-19 related disruptions Due to higher eCommerce volumes across the Group, coupled with spike in international conveyance and Group Expenses, S$M H1 FY19/20 H1 FY20/21 % change commercial freight costs as a result of Covid-19 disruptio
Slide 6: Revenue & POA breakdown by segments
Revenue & POA breakdown by segments S$M Revenue Profit on operating activities 707.8 645.6 55.5 81.0 Property 60.2 26.8 293.9 Property Logistics 244.3 39.8 23.7 Post and Parcel 68.8 22.7 Post and Parcel 373.4 392.6 5.7 Logistics (3.5) (12.3) Others1 (11.1) Inter-segment elim (32.2) (34.2) H1 FY19/20
Slide 7: Summary of Segmental POA Performance
Summary of Segmental POA Performance H1 FY19/20 POA H1 FY20/21 POA Post & Parcel Logistics Property Others S$M Turnaround -11.4% -67.1% +10.7% 68.8 26.8 5.7 23.7 (11.1) (12.3) 22.7 (3.5) International margins Benefitted from increased Largely due to rental Higher by 10.7% due to largely eroded due t
Slide 8: Cash flow and Financial Indicators
H1 FY2020/21 Financials Cash flow and Financial Indicators eCommerce Update Segmental Performance Strategy & Outlook Confidential
Slide 9: H1 cash flow reflects resilience of the business
H1 cash flow reflects resilience of the business Cashflow, S$M H1 FY19/20 H1 FY20/21 % change Strong improvement in operating cashflow due to positive Operating 38.7 127.1 +228.7% movements in working capital Investing (1.8) (3.3) +85.4% Due largely to net repayment of bank term loans and fixed rate
Slide 10: Strong financial indicators and liquidity position
Strong financial indicators and liquidity position As at Mar 20 As at Sep 20 % change Cash and cash equivalents 493.0 458.7 (7.0%) Borrowings 364.4 263.6 (27.7%) The Group remains in a net cash position, which further improved compared to the start of the Net cash / (debt) position 128.6 195.1 +51.7
Slide 11: eCommerce Update
H1 FY2020/21 Financials Cash flow and Financial Indicators eCommerce Update Segmental Performance Strategy & Outlook Confidential
Slide 12: Group: eCommerce now drives 65% of Group revenues
Group: eCommerce now drives 65% of Group revenues eCommerce related revenues estimated to be Strong growth in eCommerce volumes across various segments of around 65% of Group revenue the business H1 FY19/20 H1 FY20/21 +13% Non-eCommerce 13.2 +43% Exposure 11.6 17.8 +55% eCommerce exposure 65% 12.4 1
Slide 13: Domestic Post & Parcel: eCommerce now one-third of DPP revenue
Domestic Post & Parcel: eCommerce has accelerated, and is now one-third of DPP revenue 1H FY20/21 eCommerce revenue as % of Total DPP revenue DPP Revenue (rolling 6 months) 35% 30% Others 25% eCommerce 20% 32% 15% 10% Accelerated eCommerce 18% contribution in recent 5% months 0% eCommerce revenue co
Slide 14: Domestic Post & Parcel revenue can be sustained as eCommerce covers letter decline
Domestic Post & Parcel revenue can be sustained, as eCommerce is starting to cover Letters & Printed Papers decline Growth in eCommerce revenue is starting to cover the decline from e-Substitution YoY Growth in YoY Decline in Letters eCommerce revenue & Printed Papers revenue Rate of replacement 9 S
Slide 15: If Domestic Post and Parcel (eCommerce) & International are standalone businesses
If Domestic Post and Parcel (eCommerce), & International Post and Parcel are standalone businesses Domestic Post and Parcel (eCommerce) International Post and Parcel Revenue Estimated Revenue Global Market share1 destinations +60% +13% 34 276 Around 200 territories 22 45% 244 H1 FY19/20 H1 FY20/21 H
Slide 16: Decline in Letters & Printed Papers continues; service quality improved
Decline in Letters & Printed Papers continues; Service quality metrics at Domestic Post & Parcel have improved Revenue & volume trends Post & Parcel meeting Service Standards; for Letters & Printed Papers Ready for peak season -24% Revenue Tracked Postal Products 84 SLA by Month (latest) 64 H1 FY19/
Slide 17: Covid-19 severely impacted air freight capacity and increased conveyance costs
Covid-19 has severely impacted air freight capacity and increased conveyance costs significantly Reduced flight capacity from Surge in ex-Singapore Changi Airport Conveyance Costs (S$/KG) Change in ex-SIN conveyance cost/kg Avg No. of Flights per Day 295% 106 300% 263% 250% 238% 73 No. of flights re
Slide 18: Segmental Performance
H1 FY2020/21 Financials Cash flow and Financial Indicators eCommerce Update Segmental Performance Strategy & Outlook Confidential
Slide 19: Post and Parcel
Post and Parcel Group P&L, S$M H1 FY19/20 H1 FY20/21 % change Growth in eCommerce revenue, Revenue 373.4 392.6 +5.2% offset by letter decline International 244.0 275.5 +12.9% Domestic1 129.4 117.1 (9.5%) eCommerce 21.6 34.5 +60.0% Others 107.8 82.6 (23.4%) International margins largely eroded due to
Slide 20: Logistics
Logistics Strong growth as a result of Group P&L, S$M H1 FY19/20 H1 FY20/21 % change increased adoption of eCommerce activities in Asia-Pacific. In particular, CouriesPlease revenue Revenue 244.3 293.9 +20.3% rose 48% on strong volume growth in Australia. QS and SPeC eCommerce logistics1 120.3 167.2
Slide 21: Property & Self-storage
Property & Self-storage Group P&L, S$M H1 FY19/20 H1 FY20/21 % change Impacted by rental rebates provided Revenue 60.2 55.5 (7.8%) to eligible tenants of approximately S$3.2 million, as well as lower receipts from car-park and atrium Property 49.1 44.6 (9.1%) sales Self-storage 11.1 10.9 (1.7%) Prof
Slide 22: SPC Retail Mall performance
SPC Retail Mall performance Footfall and Tenant sales remain However, there has been a gradual down on a year-on-year basis recovery Tenant Sales ($m) Footfall (mil) Footfall Tenant sales Tenant sales has recovered -43% -45% to 80% of pre Covid-19 levels 7 4 0.9 0.9 0.8 0.6 Mil 0.4 0.4 Footfall H1 F
Slide 23: Leases expiring in FY20/21 have been substantially renewed
Leases expiring in FY20/21 have been substantially renewed Lease Expiries & Renewals for FY20/21 Expiring Renewed NLA As % of total No. of NLA As % of total No. of leases (sq ft) NLA leases (sq ft) NLA Mall 75 88,878 51.5% 64 83,212 48.2% Office / Enrichment 12 76,232 17.1% 10 65,694 14.8% Lease exp
Slide 24: Strategy & Outlook
H1 FY2020/21 Financials Cash flow and Financial Indicators eCommerce Update Segmental Performance Strategy & Outlook Confidential
Slide 25: Outlook
Outlook There remains significant uncertainty in the operating environment due to Covid-19. Group earnings and operating cashflows will continue to face headwinds from the disruptions to businesses as detailed above. The extent and duration of the headwinds will depend on when the global pandemic si
Slide 26: Outlook: Strategic acquisition in Australia
Outlook Strategic acquisition in Australia On 19 October 2020, the Group announced that it has entered into a conditional sale and purchase agreement to acquire an aggregate 38% equity interest in Freight Management Holdings Pty Ltd (“FMH”) for an aggregate consideration of approximately A$85.0 mill
Slide 27: Prudent approach to dividends given uncertain environment
Prudent approach to dividends given uncertain environment The outlook remains uncertain due to the ongoing Covid-19 situation, and the Group is adopting a prudent approach in managing cash flows. For the half year ended 30 September 2020, the Board has announced an interim dividend of 0.5 cent per s
Slide 28: Our Strategic Intent – 3 Key Thrusts
Our Strategic Intent – 3 Key Thrusts Deploying Smart Urban Build an Integrated Renewed Focus on Logistics to Dominate in B2B2C Network to Tap Property to Optimise Singapore Growing Demand and Grow Returns Future of Post - Transforming Build a strong B2B2C network Property to play a bigger role - the
Slide 29: Thank You
Thank You 28