SINGAPORE (May 14): ComfortDelGro Corporation Limited (CDG) has announced earnings of $70.4 million for the 1Q ended March, rising 6.2% from $66.3 million in 1Q18 due to higher revenue, driven by strong contributions from recent acquisitions made in late 2017 and 2018.

Revenue for the quarter grew 7.8% on-year to $947.3 million from $878.8 million, with the topline growth coming mainly from the Public Transport Services, Automotive Engineering Services and Driving Centre businesses.  

In the Public Transport Services segment, revenue grew 11.6% to $613.5 million with the contributions form new acquisitions in the Australia and the UK; higher fees earned with higher operating mileage from bus services; as well as increased ridership and average fare from rail services in Singapore.

Auto Automotive Engineering Services revenue grew 4% to $64.6 million, while revenue from the group’s Driving Centre business was 13.6% higher at $11.7 million for the quarter.

Higher revenue from these segments were however offset in part by lower income from the Taxi and Bus Station businesses, where contributions fell by 3.8% and 13%, respectively. CDG attributes the lower Taxi revenue to a reduction in operating fleet.

Group operating costs for the quarter rose 7.3% to $839.9 million, the bulk of which came from the new acquisitions and the subsequent rise in staff costs, which accounted for 65.7% of the increase.

In all, operating profit for 1Q grew 12.2% or $11.7 million on-year to $107.4 million, which the group says would have been $1.7 million higher if not for negative foreign currency impacts resulting from the weaker AUD, GBP and RMB.

As at end-March, cash and cash equivalents stood at $623.1 million as opposed to $635.1 million a year ago.

Looking ahead, CDG says it expects bus service revenue in both Singapore and Australia to grow, and that it also anticipates higher rail service revenue due to higher ridership as well as the fare adjustment of 4.3% effective from 29 Dec, 2018.

Revenue from the Taxi business, however, is expected to be lower amid “continuing keen competition”, says the group.

“The acquisitions we made in the last year have started to reap returns and we expect that they will continue to do so. We will continue to grow our core businesses, look at investment opportunities and explore new areas for growth, particularly in those that leverage on technology and strengthen our core expertise,” comments Yang Ban Seng, managing director and group CEO, on CDG’s latest set of results.

Shares in CDG closed 5 cents higher at $2.57 on Tuesday.