Why ComfortDelgro's 4Q13 results could be plagued with declines

No thanks to buses in Australia.

According to DBS, CD’s 3Q13 net profit registered a growth of 5.4% to reach S$76.7m on the back of 8.6% growth in top line to S$978.4m.

The growth in revenue was largely contributed by increases in bus (+S$62.6m/ 14.1%) and taxis (+18.4m/ 12.5%).

Here's more from DBS:

The surge in bus revenue and operating profits arose largely from the newly acquired Metroline West, which was consolidated from 1 July.

9M forms 77% of forecasts; on track to meet estimates. Operating margins remained relatively stable at 12.5% in 3Q13 despite cost pressures, particularly from staff costs (+16.1%) and repair & maintenance (+14%). 9M13 net profit forms 77% of our forecasts.

We expect 4Q13 results to be lower vis-à-vis 3Q13 - on the back of marginally lower contribution from Bus in Australia (with the handover of Regions 1 & 3) – but still likely to register growth over the same period a year ago.