SMRT's earnings derailed by repair and maintenance

The reported earnings of SG$141.5m for FY2012 was not so bad, if only it did not represent a dip of 12%.

Rental and advertising profit was up 11%, but escalating energy, staff and depreciation costs further plague SMRT's operating profit. 

Here's more from Maybank Kim Eng Singapore:

SMRT reported core FY2012 earnings of SG$141.5m that were in line with expectations, but represented a 12% decline YoY. Full year dividends were cut to S 7.45 cts. Several repair, maintenance and capex-sharing issues weigh in with increasing operating cost pressures.

The company's train and bus operations reported significant declines in operating profit, hit by escalating energy, staff and depreciation costs. Rental and advertising profit was up 11%, and was marginally higher than the profit of all the company's core transport segments put together.

The company also has large impending capex requirements which will likely require a draw-down on its SG$1b MTN facility. Interest costs will further erode profitability and affect its abililty to pay out steady dividends.