SingPost *Official* (SGX: S08)

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S&P lowers credit rating on SingPost to BBB- after divestments​

https://www.theedgesingapore.com/ne...-credit-rating-singpost-bbb-after-divestments

Standard & Poor’s (S&P) has lowered its long-term issuer credit rating for Singapore Post (SingPost) to BBB- from BBB, after the divestment of its Australian logistics and freight forwarding businesses.

The credit rating company also removed its ratings on SingPost from CreditWatch, where they placed them with negative implications on Dec 5, 2024.

S&P says that the rationale for downgrading its rating on SingPost is that the remaining core business of the company is “also facing structural decline”, following the divestment of two of its businesses.

“We view the sale of the Australian business, completed in March 2025, to be transformative, representing a significant pivot from the company's earlier strategy to establish Australia as a second home base,” reads the release by S&P dated July 25.

They note that the Australia business accounted for about 50% of operating profits (continuing and discontinued operations) for the fiscal year of 2025.

This loss of a key earnings pillar shifts the focus back to the postal and logistics business, which is facing structural and operating issues. It is also operating at significantly reduced scale and diversity, says S&P.

“SingPost's core postal and logistics business faces weak profitability amid persistent structural decline, the high fixed cost of operating its postal office network, and rising competition in a highly fragmented market,” it adds.

As SingPost is currently undergoing management changes and board transformation, S&P says that it awaits clarity on the company’s strategy to regain competitiveness and profitability.

Meanwhile, S&P highlights that the company is likely to be in a net cash position over the next two years, as the sale of two businesses has increased its cash position to $750 million.

“SingPost will have to invest to defend its postal and parcels business from a structural decline and to diversify. We believe the company's leverage may increase from a net cash position through investment cycles. The company has a track record of debt-fueled expansion. Leverage has increased to above 3 times since fiscal 2021 pursuant to SingPost's investment in Australia. This improved to 1 times from 4.1 times in fiscal 2024 after the sale of the Australian business in fiscal 2025,” the note reads.

In S&P’s view, SIngPost has to demonstrate its ability to reposition itself in the postal and logistics business under the new management team.

S&P adds that it may downgrade SingPost’s rating if they expect the company’s business competitiveness to weaken further. Consequently, it could also raise its rating if SingPost demonstrates a sustained track record of improving profitability across its core postal and logistics business, while maintaining earnings diversity and a conservative balance sheet position.

Shares in SingPost closed 0.5 cents higher or 0.8% up at 63 cents on July 25.

 

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SingPost launches new retail postal service to US in response to import rule changes​

The service offers two flat-rate packaging options, with upfront calculation of duties and taxes

https://www.businesstimes.com.sg/si...ostal-service-us-response-import-rule-changes

[SINGAPORE] Singapore Post (SingPost) will from Monday (Sep 15) launch a new postal service to the United States for retail customers, designed in “direct response” to recent changes in US import regulations.

The new Speedpost Direct International (Retail) service builds on a similar corporate-only service launched at end-August, and is aimed at meeting compliance requirements under new US import regulations, which removed “de minimis” exemptions for shipments.

Previously, under the de minimis provision, low-cost shipments at or under US$800 were allowed into the United States tariff-free.

From Aug 29, all items with commercial value shipped to the US have been subject to duties and taxes ranging from 10 to 50 per cent, depending on the product and the country of origin.

SingPost has, since Aug 25, suspended the acceptance of items with commercial value under its standard services.

With the new retail service, two packaging options will be offered: a padded envelope or a box, both provided by SingPost at a flat shipping rate. Delivery will take between five and eight working days.

Customers with existing packaging will still have their items repacked into the standard envelope or box to ensure compliance and facilitate efficient handling, SingPost said.

The padded envelope, sized at 16.2 by 22.9 centimetres with a limit of 0.5 kilograms, has a flat shipping rate of S$29 before taxes and duties. The box, at 31 cm by 23 cm by 9 cm for items up to 2 kg, has a flat shipping rate of S$69 before taxes and duties.

For both options, each shipment’s value must not exceed US$100.

The Business Times understands that prior to the imposition of the new US import regulations, parcels could be sent to the US using SingPost’s regular service at S$11.90.

The two new standard packaging options provided by SingPost at a flat shipping rate cover more than 80 per cent of the typical size of SingPost’s shipments to the US.

“The core benefit of this service is its transparency for retail customers,” said Neo Su Yin, group chief operating officer at SingPost. “Our post office staff will assist customers in calculating and collecting all necessary duties and taxes upfront, eliminating the surprise of unexpected fees for the recipient.”

For packages valued above US$100, customers may use the premium Speedpost Express International service instead, which starts at S$159 excluding taxes and duties, with a shorter delivery timeline of three to six working days.