Latest news with #SingPost
Business Times
4 days ago
- Business
- Business Times
S&P downgrades SingPost's credit rating to ‘BBB-' on downscaling, subdued operating conditions
[SINGAPORE] S&P Global Ratings on Friday (Jul 25) downgraded its long-term issuer credit rating on Singapore Post (SingPost) to 'BBB-' from 'BBB', as it has scaled down with the sale of its Australian logistics and freight forwarding businesses. Its core business also continues to face subdued operating conditions. But S&P added: 'The stable outlook reflects our expectation that SingPost will approach investments prudently, and manage the structural decline in the postal industry.' A 'BBB' rating by S&P means that the company has adequate capacity to meet its financial commitments, but is more subject to adverse economic conditions. 'BBB-' is the lowest grade that an investment-grade company can receive, and is just above a junk bond rating. The credit rating agency also lowered its issue rating on the Singapore dollar S$250 million subordinated perpetual securities that the company guarantees to 'BB' from 'BB+'. The latest downgrades came two years after S&P downgraded SingPost's long-term issuer credit rating to 'BBB' from 'BBB+', on potentially longer-than-expected weakness in its post and parcel segment. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up In its latest report, S&P said it sees the sale of SingPost's Australian logistics business Freight Management Holdings in March 2025 to be transformative, 'representing a significant pivot from the company's earlier strategy to establish Australia as a second home base'. The Australia business accounted for about 50 per cent of operating profits from continuing and discontinued operations in the 2025 fiscal year ended Mar 31, it noted. S&P also flagged the sale of SingPost's freight-forwarding business conducted through Famous Holdings and Rotterdam Harbour Holding earlier this week, after identifying it as non-core. 'The loss of a key earnings pillar shifts the focus back to the postal and logistics business, which is facing structural and operating issues,' the agency said. 'It is also operating at significantly reduced scale and diversity.' The core business faces weak profitability amid persistent structural decline, high fixed operating costs, and rising competition in a highly fragmented market, it said. It added that the operating margin for SingPost's postal and logistics as well as international businesses was about 1 per cent in the 2025 fiscal year, against the post and parcel segment's 15 per cent in the 2020 fiscal year. The agency believes that SingPost's two divestments will have bolstered its cash position by about S$750 million. It is likely to deleverage, to manage its balance sheet, it said. It will also pay out a special dividend of S$202.5 million in the 2026 fiscal year. S&P believes that SingPost's leverage could increase from a net cash position through investment cycles. It said: 'The company has a track record of debt-fuelled expansion.' The credit rating agency has removed its ratings on the company from CreditWatch, where it had placed SingPost with negative implications on Dec 5 last year. Clouded but stable outlook S&P noted that SingPost is undergoing management changes, and said it will wait for clarity on its strategy. The frequent management turnover and strategy changes cloud the operating earnings outlook, it said, adding that the 'strategic backtracking' on the sale of the entire Australia business undermines 'the consistency and execution' of its stated strategy, to diversify away from the domestic business which is facing structural decline. 'In our view, SingPost has to demonstrate its ability to reposition itself in the postal and logistics business under the new management team,' it said, pointing to the constant and ongoing changes to the board and senior management. 'The CEO position has yet to be filled.' But S&P also noted that SingPost is in talks with the government to address the financial sustainability of postal services and the post office network. The agency said that its stable rating outlook on SingPost reflects its belief that the company will prudently pursue investments and manage its postal businesses' structural decline sustainably. But it may downgrade the rating if it expects SingPost's business competitiveness to further weaken, such as in the case where it cannot stop the decline of its postal and logistics core business, or earnings diversity reduces further. A downgrade could also occur if its earnings deteriorate due to competitive pressures, or it chooses an aggressive growth strategy that causes debt to increase materially more than expected. 'A ratio of debt-to-Ebitda (earnings before interest, taxes, depreciation and amortisation) of above 2.5x will reflect such deterioration,' it said. On the other hand, an upgrade could be due 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'. SingPost shares closed at S$0.63, up S$0.005 or 0.8 per cent higher on Friday, shortly after the report was released.
Business Times
6 days ago
- Business
- Business Times
SingPost directors quizzed about CEO search and company's future strategies at AGM
[SINGAPORE] National postal service provider Singapore Post's (SingPost) board was pressed by shareholders at its annual general meeting (AGM) on Wednesday (Jul 23) for more information about the path forward as its search for a new chief executive officer drags on. Meanwhile, chairman Simon Israel, at his last SingPost AGM before stepping down, disclosed that the decision to divest SingPost Centre, the group's flagship headquarters building in Paya Lebar, now lies with the reconstituted board, which will review whether the property is non-core to the group and is to be sold. He and other directors were quizzed at the listed firm's 33rd AGM held at Suntec Singapore about the reset strategy that shareholders have been looking forward to since they approved the divestment of the Australian logistics business Freight Management Holdings for A$1 billion (about S$845 million) in March. They were also queried about the CEO who would replace the dismissed predecessor and be tasked with executing the reset strategy. Former CEO Vincent Phang was fired together with group chief financial officer Vincent Yik and CEO of international business unit Li Yu in December 2024 over the alleged mishandling of a whistle-blower's report. The questions from shareholders came as the presentation at the AGM left them none the wiser about SingPost's plans or strategies to replace the divested Australian logistics business, which had been a core business and key financial contributor. One shareholder said the reconstituted seven-member board, including incoming chairman Teo Swee Lian, did not have an idea as yet about the path forward, despite the board renewal and the passage of time. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'We came here with a lot of expectation... I feel very disappointed... We already know the current situation, but what's next? What kind of CEO are you looking for to run whatever remains (under) SingPost? 'You tell us to be patient. We have been patient all this while. Today is an important day; I thought you should have at least given us some guidance that (would signal) there is hope for SingPost.' This shareholder also asked the recently appointed non-executive, non-independent director Gan Siok Hoon – deputy group chief corporate officer of Singtel – to share the views of the telecommunications company, considering it is SingPost's major shareholder. Israel pointed out that Gan is not the spokesperson for Singtel. Questions over a new CEO Another shareholder asked the board what kind of CEO it is looking for, and suggested that a new helmsman be appointed only when the board has a clear strategy. 'Because your strategy is still in a little bit of a flux, you may hire a CEO and end up with the CEO (having) nothing much to run… Should you be a bit cautious in terms of hiring the CEO at this point, or should you continue to run with an interim CEO (until the board has) more certainty? Because I think the kind of CEO you need also depends on the strategy that you think the company should pursue.' Teo asked for patience and the opportunity for her board to do a review as these are 'not easy issues'. Also, she flagged that there will be a conversation with 'very important stakeholders' on what to do. She added: 'I do not know of any high-performing organisation that wants to continue the situation without the CEO. I think that's not best practice, really. So we do have to search for a CEO. We're very fortunate, we have the candidates… We will, in due course, identify who the person will be.' The CEO must have leadership quality, think out of the box with a free hand, and be enterprising, Teo elaborated. 'We're looking for people who can actually take a company which is not in the best situation, and still find what can be done in order to get a pathway for (us) to be sustainable in the long term.' A shareholder suggested that SingPost take the privatisation route and liquidate its assets, including SingPost Centre, and return capital to shareholders. But Israel replied that privatisation is not within the board's scope of work and that it requires an external actor. Regarding SingPost Centre The outgoing chairman also told shareholders that the SingPost Centre would be 'the last big piece' to unlock value, after SingPost sold its Australian logistics business in March and its freight-forwarding business this week, as well as the earlier sale-and-leaseback bid of 10 HDB shophouses for S$50 million. SingPost Centre was defined as 'non-core' following a strategic review in 2023-2024, because the board did not think SingPost was a property company, Israel said. The directors have not decided on the timing of the divestment even though the property, last valued at about S$1 billion, has since been earmarked for sale. Israel pointed out that the board has never set out a timeline for the sale of this asset. He added: 'Now that brings us to today's circumstances... It's quite clear that the short-term earnings of SingPost, while it works its way through its strategy and what the future holds and which options it's going to pursue, are underwritten by the property business. 'So it really will be for the board in the future to define whether that remains non-core, it becomes core, or whatever the options are around that property.' The business contributed an operating profit of S$48.4 million for the full year ended Mar 31 – more than any other segment, and higher than the total group operating profit of S$44.3 million after accounting for operating losses in some segments. All 13 resolutions were approved at the AGM that lasted more than 1.5 hours, including for a special dividend of S$0.09 per share to be paid out of the sale proceeds of the Australian logistics business. The counter closed up 2.3 per cent or S$0.015 at S$0.655 on Wednesday.
Business Times
6 days ago
- Business
- Business Times
SingPost directors quizzed about future strategies and CEO at AGM
[SINGAPORE] National postal service provider Singapore Post's (SingPost) board was pressed by shareholders at its annual general meeting (AGM) on Wednesday (Jul 23) for more information about the path forward as its search for a new chief executive officer drags on. Meanwhile, chairman Simon Israel, at his last SingPost AGM before stepping down, disclosed that the decision of divesting SingPost Centre, the flagship headquarters building in Paya Lebar, now lies with the reconstituted board, which will review whether the property is non-core to the group and is to be sold. He and other directors were quizzed at the listed firm's 33rd AGM held at Suntec Singapore about the reset strategy that shareholders have been looking forward to since they approved the divestment of the Australian logistics business Freight Management Holdings for A$1 billion (about S$845 million) in March. They were also queried about the CEO who would replace the dismissed predecessor and be tasked with executing the reset strategy. Group CEO Vincent Phang was fired together with group chief financial officer Vincent Yik and CEO of international business unit Li Yu in December 2024 over the alleged mishandling of a whistle-blower's report. The questions from shareholders came as the presentation at the AGM left them none the wiser about SingPost's plans or strategies to replace the divested Australian logistics business, which had been a core business and key financial contributor. This caused a shareholder to express his displeasure that the reconstituted seven-member board, including incoming chairman Teo Swee Lian, does not have an idea as yet about the path forward, despite the board renewal and the passage of time. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'We came here with a lot of expectation... I feel very disappointed... We already know the current situation, but what's next? What kind of CEO are you looking for to run whatever remains in SingPost? 'You tell us to be patient. We have been patient all this while. Today is an important day; I thought you should have at least given us some guidance that (would signal) there is hope for SingPost.' This shareholder also asked the recently appointed non-executive, non-independent director Gan Siok Hoon – deputy group chief corporate officer of Singtel – to share the views of the telecommunications company, considering it is SingPost's major shareholder. Israel pointed out that Gan is not the spokesperson for Singtel. Questions over a new CEO Another shareholder also asked the board about the kind of CEO it is looking for, and suggested that a new helmsman be appointed only when the board has a clear strategy. 'Because your strategy is still in a little bit of a flux, you may hire a CEO and end up with the CEO (having) nothing much to run… Should you be a bit cautious in terms of hiring the CEO at this point, or should you continue to run with an interim CEO (until the board has) more certainty? Because I also think the kind of CEO you need also depends on the strategy that you think the company should pursue.' Teo asked for patience and the opportunity for her board to do a review as these are 'not easy issues'. Also, she flagged that there will be a conversation with 'very important stakeholders' on what to do. She added: 'I do not know of any high-performing organisation that wants to continue the situation without the CEO. I think that's not best practice, really. So we do have to search for a CEO. We're very fortunate, we have the candidates… We will, in due course, identify who the person will be.' The CEO must have leadership quality, think out of the box with a free hand, and be enterprising, Teo elaborated. 'We're looking for people who can actually take a company which is not in the best situation, and still find what can be done in order to get a pathway for ourselves to be sustainable in the long term.' A shareholder suggested that SingPost take the privatisation route and liquidate its assets, including SingPost Centre, and return capital to shareholders. But Israel replied that privatisation is not within the board's scope of work and that it requires an external actor. Regarding SingPost Centre The outgoing chairman also told shareholders that the SingPost Centre would be 'the last big piece' to unlock value, after SingPost sold its Australian logistics business in March and its freight-forwarding business this week, as well as the earlier sale-and-leaseback bid of 10 HDB shophouses for S$50 million. SingPost Centre was defined as 'non-core' following a strategic review in 2023-2024, because the board did not think SingPost was a property company, Israel said. The directors have not decided on the timing of the divestment even though the property, last valued at about S$1 billion, has since been earmarked for sale. Israel pointed out that the board has never set out a timeline for the sale of this asset. He added: 'Now that brings us to today's circumstances... It's quite clear that the short-term earnings of SingPost, while it works its way through its strategy and what the future holds and which options it's going to pursue, are underwritten by the property business. 'So it really will be for the board in the future to define whether that remains non-core, it becomes core, or whatever the options are around that property.' The business contributed a full-year operating profit of S$48.4 million – more than any other segment, and higher than the total group operating profit of S$44.3 million after accounting for operating losses in some segments. All 13 resolutions were approved at the AGM that lasted more than 1.5 hours, including for a special dividend of S$0.09 per share to be paid out of the sale proceeds of the Australian logistics business. The counter closed 2.3 per cent or S$0.015 up at S$0.655 on Wednesday.
Independent Singapore
6 days ago
- Business
- Independent Singapore
SingPost completes S$177.9M sale of entire freight forwarding business
FB screengrab/ SingPost SINGAPORE: Singapore Post Limited (SingPost) has divested its entire freight forwarding business conducted through Famous Holdings Pte Ltd (FHPL) and Rotterdam Harbour Holding B.V. (RHH) for around S$177.9 million, according to the company's media release on Tuesday (July 22). The sale was carried out in two parts to separate buyers. The first was sold to DP World Logistics FZE for about US$97.7 million (S$125.5 million), while the other was sold to a consortium that includes some of Famous Holdings' minority shareholders for around €35.7 million (S$52.4 million). SingPost said the deal resulted in a gain of about S$10.5 million and freed up S$104 million in cash for the company. SingPost's chairman Simon Israel said the move is part of the company's strategy, announced in March 2024, to divest non-core assets and recycle capital. 'Following a comprehensive international sale process to explore various options for Famous Holdings, the Board concluded that selling the business in two parts would secure the highest possible valuation,' he added. SingPost said the proceeds will contribute to the company's cash balance, which shall be determined by the board based on the company's funding needs. The sale follows SingPost's divestment of its Australian logistics business, Freight Management Holdings (FMH), to private equity firm Pacific Equity Partners for about S$845 million in March. /TISG Read also: Singapore customers can now drop off FedEx parcels at any SingPost POPStop counter and POPStop@Tampines MRT () => { const trigger = if ('IntersectionObserver' in window && trigger) { const observer = new IntersectionObserver((entries, observer) => { => { if ( { lazyLoader(); // You should define lazyLoader() elsewhere or inline here // Run once } }); }, { rootMargin: '800px', threshold: 0.1 }); } else { // Fallback setTimeout(lazyLoader, 3000); } });
Straits Times
7 days ago
- Business
- Straits Times
SingPost shares up 1.6% after it sells freight forwarding business
Find out what's new on ST website and app. The move was part of SingPost's ongoing efforts to divest its non-core assets and businesses to recycle capital. SINGAPORE - Shares of Singapore Post a hit multi-year high in intra-day trading on July 23, the day after the company announced the divestment of its entire freight forwarding business. The move was part of SingPost's ongoing efforts to divest its non-core assets and businesses to recycle capital. It resulted in an estimated gain of $10.5 million on disposal and release of about $104 million in cash for the company. At the midday trading break, the counter was up 1.6 per cent, or one cent, to 65 cents, after rising to as high as 65.5 cents earlier. SingPost shares last closed above 65 cents in July 2022. SingPost announced on July 22 after the market closed that it sold its freight forwarding business conducted through Famous Holdings and Rotterdam Harbour Holding B.V, for approximately $177.9 million. Famous Holdings and its related businesses were sold to DP World Logistics FZE for about US$97.7 million (S$125 million). It operates in several countries such as Japan, Australia, New Zealand, the United Kingdom, Malaysia and Singapore. Meanwhile, SingPost's fully-owned subsidiary - SingPost eCommerce Logistics Holdings - sold its entire stake in Rotterdam Harbour Holding for around €35.7 million (S$52.4 million). SingPost said: 'The divestments further strengthen SingPost's financial position.' It added that specifically for Rotterdam Harbour Holding, its net asset value as at March 31, 2025, was $30 million, with a net profit before income tax and non-controlling interests of $15.9 million for the same period. SingPost said in May that its strategic review and restructuring are ongoing. In June, it put up for sale 10 Housing Board (HDB) shophouses currently occupied by its post office outlets across Singapore, with the aim of leasing them back. SingPost has 42 post offices, of which it owns 21. As part of its efforts to restructure, it also sold its Australian logistics business, Freight Management Holdings (FMH). SingPost completed the sale of FMH for A$1.02 billion (S$856 million) in March. Maybank analyst Jarick Seet said: 'I think the monetisation of assets will continue to be the key for share price performance for SingPost.' He added that it is also looking to sell its flagship retail-commercial mixed development SingPost Centre at Paya Lebar Central, but that he only expects that to happen in 2026. SingPost had said in 2024 that it is considering selling SingPost Centre, which it also identified as a non-core asset. The property was valued at $1.1 billion as at September 2023.
