SMRT operating expenses outstripped revenue growth by 5-7%

In just the past 3 years.

According to Maybank Kim Eng, driven by population growth and accommodative public transport policies, revenue for SMRT’s fare based business increased by close to 50% over the past decade. 

However, the ongoing capacity addition (new rail lines, rail & bus fleet expansion etc.) led to an even higher growth in operating expenses. In view of a comprehensive fare formula review this year, transport fares were also kept unchanged in 2012.

Here's more from Maybank Kim Eng:

Consequently, profits at SMRT’s core fare based business had been on a steady decline as operating expenditure (OPEX) outpaced revenue growth by 5-7% over the past 3 years.

As a result of this persistent mismatch between fare revenue and OPEX, we expect earnings for the fare based business to remain poor for the next 3 years.