SINGAPORE (Nov 13): Mainboard-listed land transport operator ComfortDelGro Corporation saw its earnings fall 10.8% to $70.0 million for 3Q19 ended September, from $78.5 million in 3Q18.

On a fully diluted basis, this translates to earnings per share (EPS) of 3.23 cents for 3Q19, compared to EPS of 3.62 cents in 3Q18.

Operating profit for the quarter was down 4% to $108.9 million during the quarter, on the back of higher losses in the rail business and keen competition in the taxi business, as well as the negative impact of foreign currency translations to the Australian dollar and the euro.

3Q19 revenue inched up 1.1% to $979.0 million, following substantial increases in the group’s driving centre business and public transport services.

Revenue from its driving centre business up was 9.6% to $12.5 million, after fees for tests were raised last year.

Meanwhile, revenue from its public transport services business grew 4.5% to $727.1 million, on the back contributions from new acquisitions in Australia, higher fees from increased mileage and better performance for bus services. The fare adjustment made in December 2018 also saw the group collecting higher fees.

Aside from this, marginal increments in the revenue from its inspection and testing services and car rental and leasing business, contributed to the overall revenue gains.

On the other hand, revenue from the taxi business fell by 9.6% to $162.1 million, following a contraction in its operation fleet.

The group also saw a shrinkage in revenue from its automotive engineering services business and bus station operations.

As at end September, the group’s cash and cash equivalents stood at $518.5 million, higher than the $490.9 million at the end of 3Q18.

Going forward, ComfortDelGro expects a growth in revenue from its public transport services businesses, in spite of cost pressures from operating and maintenance.

A substantial increase will come from the 7% hike in public transport fares that will take effect on Dec 29.

It is also looking for higher bus service revenue following the receipt of the full year contributions from the Seletar and Bukit Merah Bus Packages it commenced in last March and November.

ComfortDelGro also forecasts higher revenue from its bus business in Australia, following the receipt of full-year contributions from acquisitions made last year as well as earlier this year.

Aside from these, it is seeking out new acquisitions and investments in the mobility space both in Singapore and abroad.

Speaking on the results, ComfortDelGro’s managing director and Group CEO Yang Ban Seng noted that the weak global economy and political economy had “weighed down on the business”, further “intensi[fying] competition”.

“Despite the significant challenges, we have managed to grow our topline, with stronger contributions from our overseas businesses. Our Australian operations, in particular, have performed well, buoyed by the acquisitions that we made last year. Our public transport business continued to gain strength, growing both in terms of revenue and profit”, he adds.

Shares in ComfortDelGro closed 1 cent lower at $2.38 on Wednesday before the results announcement.