SINGAPORE (Nov 2): Singapore Post reported 2Q19 earnings ended Sept of $25.1 million, down 12.9% from a year ago, due largely to an exceptional fair value loss os $2.9 million on warrants from an associated company.

Excluding such one-off items, underlying net profit was stable at $28.1 million, as operating profit improved 33.5% to $40 million but was offset by share of loss of associates of $3.6 million.

Revenue for 2Q19 increased 2.2% to $368.7 million, on stronger contributions from international mail and property.

Revenue from e-commerce-related activities across the group rose 2.2% in the quarter to $189.1 million, contributing 51.3% of total revenue.

In the post and parcel segment, revenue increased to $176.7 million on growth in cross-border e-commerce deliveries, while profit on operating activities rose 5.1% to $42.1 million, driven by higher margins from last-mile e-commerce deliveries in Singapore.

The logistics segment reversed a loss in the previous year to record an operating profit of $0.3 million on flat revenue of $125 million due largely to smaller losses at Quantium Solutions, which has been reviewing unfavourable customer contracts to improve profitability, and strong contributions from the freight forwarding business.

Operating expenses dipped 0.4% at $331.7 million as labour and related expenses narrowed 6.2% to $76.9 million.

Profit on operating activities from property rose 54.1% to $13.3 million, boosted by rental income from the SingPost Centre retail mall, which re-opened in October 2017.

For 2Q19, the board of directors has declared an interim dividend of 0.5 cent per share to be paid on Nov 30.

In its outlook, SingPost says the group remains well-positioned to benefit from the growth in global e-commerce activities although it remains highly competitive while domestic mail volumes are expected to trend downwards.

“We continue to integrate the operations of TradeGlobal and Jagged Peak in the US, in challenging market conditions,” it adds.

Year to date, shares in SingPost are down 18.3% to close at $1.04 on Friday.