ComfortDelGro third quarter profit up 10.4% to $61mln

Revenue increased 5.2% to $823.4mln with increases coming from almost all business segments as overseas businesses accounted for 42.5% of total revenue.

ComfortDelGro Corporation’s revenue for the three months ended 30 September 2010 increased by $40.8 million, or 5.2% year-on-year, to a record $823.4 million. The growth would have been even stronger at 7.9% had it not been for the negative translation effect of the weaker Sterling Pound, Chinese Renminbi and Vietnamese Dong. At the operating level, revenue growth was broad based in both geographical and segmental terms.

In line with the growth in revenue, operating profit for the period was 16.8% higher at $106.2 million.
Correspondingly, third quarter net profit increased by 10.4% to $61.4 million, bringing the net profit for the year-to-date to $173.9 million, according to a ComfortDelGro report.

Operations Review

Bus
At Group level, third quarter revenue for the bus business increased by 5.1% to $422.0 million, boosted by growth in Australia, Singapore and China.

The Group’s bus business in Australia saw revenue increase by 24.1% to $95.4 million due to an increase in services operated and a favourable foreign currency translation effect.

In Singapore, revenue from scheduled bus services under SBS Transit rose by 2.9% to $140.2 million during the quarter as average daily ridership increased. Including revenue from advertising and rental, total revenue at SBS Transit increased by 4.0% to $150.0 million.

In China, bus revenue increased by 0.6% to $15.5 million in the third quarter of this year as ridership continued to grow.

In the UK, revenue from the bus business was 7.9% lower at $145.8 million due to the negative foreign currency translation effect of the weaker Sterling Pound.

For the quarter ended 30 September 2010, revenue from the overseas bus operations accounted for 60.8% of total Group bus revenue. Despite the negative translation effect of the weaker Sterling Pound, the UK operations continued to account for the bulk of overseas bus revenue, or 56.8%. This was followed by the Australian bus operations at 37.2% and the China bus operations at 6.0%.

Taxi
At Group level, third quarter revenue for the taxi business increased by 8.6% to $249.6 million as gains in Singapore and Vietnam more than offset the declines in China and the UK.

In Singapore, revenue from the taxi business increased by 13.4% to $180.7 million due mainly to a higher volume of cashless transactions and a larger operating fleet.

In China and the UK, revenue increases were more than offset by the unfavourable foreign currency translation effect of the weaker Renminbi and Sterling Pound. As a result, revenue from the taxi business in China fell by 4.4% to $30.6 million while revenue from the taxi business in the UK dipped by 0.8% to $36.6 million.

In Vietnam, revenue from the taxi business increased by 13.3% to $1.7 million.

Revenue from the Group’s overseas taxi business accounted for 27.6% of total Group taxi revenue.

Rail
Revenue from the rail business in the third quarter increased by 13.0% to $30.9 million on continued ridership growth. Average daily ridership for the North East Line grew by 20.0% to 394,000 while that for the Punggol and Sengkang LRTs increased by 15.5% to 54,000.

Bus Station
Revenue from the bus station business under Guangzhou Xin Tian Wei increased by 18.9% to $6.3 million due to an increase in passenger traffic.

Vehicle Inspection and Testing
Revenue from the vehicle inspection and testing business grew by 11.0% to $22.2 million as more vehicles were inspected and more non-vehicle testing projects completed.

Commentary
Revenue from the bus business in Singapore is expected to increase in line with the positive economic outlook for the rest of the year. Revenue from advertising in Singapore is also expected to increase. Revenue from the bus business in the UK is expected to be impacted by the foreign currency translation effect of the weaker Sterling Pound. Revenue from the bus business in Australia is expected to continue to improve while revenue from the China bus business is expected to be maintained.

Revenue from the rail business is expected to benefit from ridership growth.

Revenue from the bus station business in Guangzhou is expected to increase.

Revenue from the taxi business in Singapore is expected to increase with more cashless transactions and new replacement taxis. Revenue from the taxi businesses in China, the UK and Vietnam is expected to be maintained.

Revenue from the driving centre business in Singapore and China is expected to increase.

Revenue from the vehicle inspection and testing business in Singapore is expected to improve.

Revenue from the car rental and leasing business in Singapore, Malaysia and China, as well as the automotive engineering business, is expected to be maintained.

As global economic conditions remain uncertain, the Group will remain vigilant and continue to focus on the demand patterns of its customers. Expenses will continue to be tightly controlled even as fuel and electricity pose challenges. The Group will continue to seek opportunities for growth.