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ComfortDelGro logs H1 profit of S$91 million, reversing last year's loss
https://www.channelnewsasia.com/business/comfortdelgro-2021-h1-net-profit-91-million-2111226
SINGAPORE: ComfortDelGro on Friday (Aug 13) announced a net profit of S$91 million in the first half of 2021, as global economic activity gradually resumed amid the COVID-19 pandemic.
This reversed what the company called "massive" destruction in the same period last year, when it posted a net loss of S$6.6 million.
In a media release on Friday, ComfortDelGro's managing director and Group CEO Yang Ban Seng described the past six months as "painful but tolerable".
"The global situation continues to be difficult but it is definitely an improvement over the catastrophic conditions we all experienced last year," said Mr Yang.
While the situation has improved, the "continuous see-saw effect of lockdowns and reopenings" has taken its toll on businesses and the community, he added.
"As a group, we have hunkered down and looked at reducing costs as best we can without affecting jobs. We looked at ways to keep our people safe and well, and our vehicles clean," said Mr Yang.
The unaudited results also saw ComfortDelGro log first-half group revenue of S$1.74 billion, up 13.6 per cent from the same period last year.
In addition to the gradual resumption in economic activity, revenue growth was boosted by a positive foreign exchange translation effect of the stronger Australian dollar and sterling pound, it said.
PUBLIC TRANSPORT, TAXI REVENUES RISE
ComfortDelGro said it registered growth in all key financial segments in the first half of 2021.
Revenue from its public transport arm, comprising bus and rail services, grew 11.3 per cent to S$1.4 billion. This was mainly due to improved rail ridership and fuel indexation in Singapore, and more ad hoc charter activities in Australia.
Taxi business revenue expanded 26.5 per cent to S$225.9 million following lower COVID-19 relief schemes extended to drivers as business activity resumed.
Automotive and engineering services revenue also rose by 4.1 per cent to S$85.5 million, while that from inspection and testing services rose by 23.1 per cent to S$49.1 million.
Revenue from ComfortDelGro's driving centre business also jumped 71.6 per cent to S$26.6 million, compared to the full closure of centre operations during last year's "circuit breaker".
However, revenue posted by its car rental and leasing business fell 6.5 per cent to S$13 million due to a smaller fleet as Singapore's expatriate population shrank.
Lockdowns and travel restrictions also dampened the group's bus station business in China by 2.9 per cent to S$6.6 million.
The group said it received a total of S$57.2 million in government reliefs in the first half of 2021, compared to S$82.3 million over the same period last year.
Excluding government relief, it posted an operating profit of S$77.4 million, compared to a loss of S$76.5 million for the same period last year.
BUSINESS OUTLOOK
Turning to its business outlook, ComfortDelGro said it expects global economic recovery to vary across countries and sectors, depending in part on the pace of vaccination and reopenings.
The group, which operates in Singapore, Australia, China, the United Kingdom, Ireland, Vietnam and Malaysia, said outbreaks of new COVID-19 variants have led to further restrictions being imposed across its operating locations.
It also noted underlying challenges in the land mobility business, including changes in commuting patterns, technological disruptions and competition.
"As governments and financial markets focus on rebuilding and living with endemic COVID-19, we expect a slow and uneven recovery in ridership resulting in depressed revenues and margins," said ComfortDelGro.
"With a strong balance sheet, the group remains committed to its long-term mobility strategy and continues to transform and build its capabilities while looking for growth opportunities in overseas markets and adjacent segments."
The group declared an interim dividend of 2.1 cents per ordinary share. It did not declare an interim dividend in the first half of 2020.
