ComfortDelGro’s profit up 5.3% to $80.8m in Q3

But expect a weaker Q4.

Mainboard-listed transport operator ComfortDelGro reported a 5.3% increase in its profit after tax and minority interest in the third quarter. CDG’s profit climbed to $80.8m on the back of a 6% increase in revenue to $1.04b.

According to OCBC, the increase was driven by strong results from its bus operations in Singapore and the UK. However, this strength was marred by a 17.3% decline in revenue from its Australian operations.

CDG’s rail segment also saw an increase in average daily ridership from both North-East Line (NEL) and Downtown Line (DTL), further boosted by higher average fares.

“Top line growth was mainly driven by the Bus (+4.9%), Rail (+21.4%) and Taxi (+7.9%) segments. For 9M14, CDG’s revenue and PATMI rose 9.0% and 8.1% YoY to S$3,004.4m and S$219.8m, forming 75.9% and 78.2% of our FY14 projections. For the past four fiscal years, 4Q had traditionally been the weaker quarter and hence, we view 9M14 PATMI meeting 78.2% of our FY14 projections to be largely in-line,” noted OCBC.

Here’s more from OCBC:

For the larger contributors, CDG’s management guided for revenue from Singapore’s bus, rail and taxi segment as well as the UK’s bus segment to increase.

Singapore’s bus segment is likely to see increasing ridership and average fares but also higher staff salaries while contribution from Metroline West in the UK is the key driver for UK bus revenue growth.

On the other hand, Automotive Engineering Services (AES) and Australia’s bus segment are likely to see decreases. Australia’s decline is mainly due to the loss of regions 1 and 3 and the slightly lower margin seen in region 4 while the drop in AES segment will largely be due to lower diesel sales. 

While Taxi revenue in Singapore is expected to increase due to fleet renewal commanding higher rental income, taxi revenues from other countries are expected to be maintained.