SMRT   

SMRT

 

  Ridership information update

  http://www.lta.gov.sg/content/dam/ltaweb/corp/PublicationsResearch/files/FactsandFigures/Stats_in_Brief_2013.pdf

 

What is most importance to the stake holders is : service level & the bottom lines must be improved with so much increased in staff cost!

WanSiTong      ( Date: 30-Jul-2013 22:50) Posted: Staff cost rose 23.4% to $112.7 million due to increased headcount for train and bus operations and wage revision, partially offset by the Wage Credit Scheme. Very jialuck!

 

Staff cost rose 23.4% to $112.7 million due to increased headcount for train

and bus operations and wage revision, partially offset by the Wage Credit Scheme.

Very jialuck!

 

Hire too many consultants.  My view only.

WanSiTong      ( Date: 30-Jul-2013 22:06) Posted: Net profit dropped $20.1m to $16.3m  due mainly to the increase in staff cost of $21.4m (up 23.4% from $91.3m to $112.7m) How can the staff cost increase so much ? Octavia      ( Date: 30-Jul-2013 21:47) Posted: SMRT Corporation's first-quarter net profit plunged 55.2 per cent to S$16.3 million on higher costs, the group revealed after the market closed on Tuesday. Revenue for the same period ended June 30, 2013 inched up 3.5 per cent to S$284.8 million, but operating expenses grew 11 per cent to S$272.1 million, while finance costs almost tripled to S$2.6 million. Earnings per share for the group stood at 1.1 Singapore cents for the quarter, down from 2.4 Singapore cents during the corresponding period the year before. The group's counter closed half a cent lower at S$1.43, before it released the results.

 

Net profit dropped $20.1m to $16.3m  due mainly to the increase in staff cost of $21.4m (up 23.4% from $91.3m to $112.7m)

How can the staff cost increase so much ?

Octavia      ( Date: 30-Jul-2013 21:47) Posted: SMRT Corporation's first-quarter net profit plunged 55.2 per cent to S$16.3 million on higher costs, the group revealed after the market closed on Tuesday. Revenue for the same period ended June 30, 2013 inched up 3.5 per cent to S$284.8 million, but operating expenses grew 11 per cent to S$272.1 million, while finance costs almost tripled to S$2.6 million. Earnings per share for the group stood at 1.1 Singapore cents for the quarter, down from 2.4 Singapore cents during the corresponding period the year before. The group's counter closed half a cent lower at S$1.43, before it released the results.

 

 

Technical Rebound ?

 

SMRT stock may have reached the bottom. Any opinions?

 

Sold off all, no future for SMRT with gov subcumbed to public pressure.

 

CEO hisself also claimed SMRT is unsustainable business model!!! Faster run away from this counter!!

 

Jia latz leh....what happen?? :(

 

SMRT Corporation - Not a stock to own

What is the news?

SMRT (Sell Target Price: $0.93) reported losses of S$12mn for 4QFY13. The losses in the quarter were driven by an S$17.3mn impairment charge on Shenzhen Zona, significantly higher staff cost (+28.5%) and repair & maintenance expenses (+41.6%). With significantly lower profits for the year, SMRT cut its final DPS to 1.50cents, representing a full year payout of 2.50cents (45.6% of FY13 PATMI). Outlook statement remains negative as management highlighted continued increase in operating costs and expects profitability to be impacted in FY2014.

How do we view this?

With the company’s earlier profit warning, the quarterly losses were well expected by the market. However, the magnitude of the dividend cut surprised us (and probably consensus), reflecting a dividend yield of merely 1.7% at the current price. With operating costs trending north, we expect SMRT to report structurally lower profits in our forecast years.

Investment Actions?

Despite a sharp decline in recent months, we believe that the stock of SMRT had not bottomed out. We maintain our Sell recommendation as the unsustainable business model, structurally lower earnings, rising leverage and poor dividend yield support gives investors little reason to own this stock. Unless there is a radical change in the business model, we expect a multi-year de-rating of this stock. With poor cashflow visibility, we switch to our blended valuation method to a simple P/E model pegged to 15X FY14E.

Source: PhillipCapital Research - 2 May 2013

 

Maybank Kim Eng :Sell call TP @$1.19

The previously unimaginable has happened. SMRT is expecting its first ever quarterly loss in its history for 4QFY3/13. Escalating operating costs and a SGD17m impairment in goodwill in its associate, Shenzhen ZONA, are the primary causes of the loss. We are expecting the PATMI loss to come in at ~SGD2m for the quarter, which still points to profitability at a core level excluding the effects of the impairment.However we expect final dividends to be cut as a result of this announcement. We were among the earliest to downgrade SMRT to a SELL in early 2012. This loss guidance validates our sustained SELL call, and we are reiterating it with a reduced, Street-low target price of SGD1.19.

 

SMRT Corporation: More impairments?
We view the recent goodwill impairment announcement as a way for SMRT’s new management to turn the page on its past overseas ventures although the timing did take us by surprise. While the Shenzhen ZONA venture failed to yield the desired results, its performance only turned negative over the past two quarters. Nonetheless, we feel that management review of existing operations is still ongoing, and we could see further impairments – particularly on the SG bus business – down the line. In the interim, we expect to see a net loss in excess of S$4.3m for 4QCY13, and a possible halving of FY12’s final dividend. As we roll our valuations forward to include FY15, our fair value declines to S$1.51 from S$1.62 previously with higher operating expenses and a lack of growth opportunities to blame. We maintain HOLD on SMRT and reiterate our view that an inflection point is unlikely anytime soon. (Lim Siyi)

 

China Railway is nothing better in reputation then SMRT.

  23rd Jul 2011, Wen zhou train collision killed 40 people and injured at least 192.

28th september 2011, Shanghai closes 13 stations due to train collision, more then 270 people injured.

The recent formation of the China Railway Corporation which splitout from the Railway ministry, register asset is only 1,036billion RMB. But the total dept that the China Railway Corporation is 2,660billion RMB. This is a big sum not a small one, this is equivalent to European crisis national debt. The government given the target is to complete the 120,000km of railway by 2015, after so many years the railway ministry only complete 98,000km, which means 22,000km in 1 and 3/4years. That is why the railway ministry was being breakup to ensure that the government would not be blame for not meeting the target. With the formation of corporation, the government in one way push away the responsibility of meeting the target, they also push away the huge debt, for the pass development. Leave behind is a huge debt corporate that need to return the huge debt. Beside also the risky Bank default if China Railway Corporation fail to repay the debt. Just the interest to repay is already 25billion yearly. With such a huge dept as a corporation, it will be difficult for bank to continue to finance them(previously as it is borrow to government, now the government debt become corporate debt). Thus the fast and easy way to reduce debt will be by selling their asset or through corporation with others. Thus those involve in the operation or Reits or infrastructure funds might be opening their eyes big to decide which city metro to take on.

kelvinLim123      ( Date: 01-Apr-2013 19:08) Posted: Navie to think they let SMRT run theirs, after all these bad publicity abt those major breakdown.   cheongsl      ( Date: 30-Mar-2013 13:09) Posted: China railway might soon start selling asset to raise money to cover their dept, not too sure will SMRT as an operator interested to operate China metro...

 

Navie to think they let SMRT run theirs, after all these bad publicity abt those major breakdown.

 

cheongsl      ( Date: 30-Mar-2013 13:09) Posted: China railway might soon start selling asset to raise money to cover their dept, not too sure will SMRT as an operator interested to operate China metro...

 

This one stop at exactly 1.54 , exactly as i stated it last week. 

Shorted with little profit.

I cannot say further, i know the pain of those vested. I shd not make it more painful for you.

But if i am a stake holder, i think the future look bleak , I would sell, and move on.

In fact, today u shd have shorted to hedge.

I think future div is now a big question mark? 

and now they are talking about free travel? I m still alittle confuse abt the news.

but free at the expense of profitability of SMRT, unless govt pay. 

kelvinLim123      ( Date: 30-Mar-2013 00:08) Posted: This one i think Monday we see 1.54. my guess.

 

China railway might soon start selling asset to raise money to cover their dept, not too sure will SMRT as an operator interested to operate China metro...

 

This one i think Monday we see 1.54. my guess.

 

Ex-CEO Saw Peck Hwa took care of share holders' interest  to raise share price...

The new CEO Desmond Kuek is tasked to take care of the service reliability and safey, all these works need to spend a lot $. Also more $ will be spent  in future and no time to do other thing.

This makes a big difference between both of them. So moving forwar, it is an indication whether we should buy SMRT shares now.

Luostock      ( Date: 29-Mar-2013 21:01) Posted: MRT line  takes long time to construct. There is a limit of many trains can use the rails at the same time. MRT will be used to solve long term problem. Buses are more flexible, can be diverted to any other routes whenever there is a need. Buses are for solving transport problem  in the short  term. Singapore govt is very conservative. When Mr Ong Teng Cheong suggested MRT, there were many ministers (ordinary citizens as well) against it. So in the end the conservative nature choose 6-carriage train rather than the 8-carriage train that HK used. They could have forseen the need for 8-carriage trains by building longer stations to cater for future needs at that time. Now if we are going to extend to 8-carriage, there is no way to do it without major disruption. There is no way to make profit if the fare is kept artificially low. So things start to break down after 10 years. So the previous CEO had to depend on renting out shops and advertisment boards to make profit. If only someone was brave enough to tell the cabinets that it is high time to renew the lines a few years ago. So far i have not heard any public transport make any profit in this world. In HK, there were many PRC working in their MTR lines. This help them to keep the wage low but their fare  is still higher than singapore. They are using the land sold along the MTR lines to support the rail. I think it would be good if our MRT lines are given more land pieces to build shops and rent out around the MRT station to help to collect revenue for the MRT, thus can keep the fare as low as possible and as long as possible. Foreigners should not be subsidised, so only locals with bus pass (students) or NRIC are charged subsidised fare. All foreigners should paid the actual fare. Citizens will then know they are paying very little compared to the foreigners.   bikerlover      ( Date: 29-Mar-2013 10:41) Posted: First thing MRT is more efficient than buses    - introduce so many buses for what??  Every bus need to be driven by a bus driver = most cost!! Every bus need a maintance schedule, place to park  = more cost!! Buses running along MRT lines = dilution of passengers onboard. Suggestion to cut cost - Rental of buses(like taxis)  to singaporean driver.  Foreigners can only relief drivers for singaporean.  This will minimise the cost and risk for the company(no need to pay staff salary and diesel).  Rules/running time schedule still must follow company.