SBS Transit Turns In Full-Year Revenue of $1.3 Billion

Group

Group revenue for the year ended 31 December 2021 increased by 6.5% or $79.9 million to $1.3 billion compared to 2020. 

Group operating costs increased by 9.2% or $106.3 million to $1.3 billion due mainly to higher fuel and electricity costs as well as staff costs. The surge in energy prices resulted in a spike of 65.1% or $58.6 million in our fuel and electricity costs to $148.7 million for the year ended 31 December 2021. 

The Group fell into the red at the operating level for the second consecutive year of the pandemic, although it significantly narrowed the loss from $29.8 million in 2020 to $2.8 million in the year just ended. The improved performance was in line with the gradual recovery of the Singapore economy but this was offset by a one-time loss of $16.0 million from the disposal of 241 buses which were replaced with new and greener ones from the Land Transport Authority.

Taking into account the Government reliefs of $56.3 million, the Group managed to stay in the black with a full-year operating profit of $53.6 million, down 33% from 2020. The Government reliefs, although significantly lower by 48.7% than in 2020, helped to partially cushion the adverse financial impact due to COVID-19. The COVID-19 impact included a significant drop in ridership compared to pre-COVID levels, rental rebates given to tenants and expenses arising from stepped up cleaning costs of vehicles and premises to protect our passengers and employees. 

Full-year net profit attributable to shareholders fell by 34.6% or $27.3 million to $51.6 million. 

SBS Transit CEO, Mr Cheng Siak Kian, said: “This is the second year of an unprecedented crisis of a generation. As Singapore’s dominant public transport operator, we continued to see low ridership on our buses and trains as people continued to work from home, nightlife remained non-existent, and COVID-19 restrictions remained in force. While things may have improved compared to 2020, we are certainly not out of the woods. The situation remains fluid as new COVID-19 variants may emerge, we are both cautious and yet hopeful for a recovery. Our people and our passengers remain our focus and we continue to work at being a stronger, reliable and efficient public transport operator.”

Operations Review

• Public Transport Services

Full-year revenue from the Public Transport Services business, which comprised bus and rail services, increased by 5.8% or $69.5 million to $1.3 billion when compared to the year before. The increase came mainly from higher bus service fees offset by lower mileage, higher rail ridership offset by lower average fares, and also higher other operating income. Rail ridership increased by 4.5% with close to 271.3 million passenger trips made in 2021. However, ridership has yet to reach pre-COVID-19 levels with a drop in total ridership of 39% when compared to 2019.  

• Other Commercial Services

Revenue from Other Commercial Services business increased by 29.5% or $10.4 million to $45.5 million for the year ended 31 December 2021 due mainly to higher advertising revenue as more advertisers resumed their campaigns and a reduction in rental rebates given to tenants.  

Dividend

A final tax-exempt one-tier dividend of 2.45 cents per share has been proposed. Together with the interim tax-exempt one-tier dividend of 5.75 cents paid earlier, the total dividend for 2021 will be 8.20 cents per share or a payout ratio of 49.5% if the final dividend is approved by shareholders at the Annual General Meeting on 28 April 2022. 

Outlook

Since 1 January 2022, the Government has allowed employees to resume work at the workplace where up to 50% of them can do so at any one time. With this change in work arrangements, revenue from Public Transport Services is expected to be higher as rail ridership improves. However, it is unlikely that ridership in the near future will be able to achieve pre-COVID levels as many employees continue to work from home.

Revenue from Other Commercial Services is expected to increase with the gradual recovery of the economy. However, the rate of growth is dependent on market sentiments and the economy’s rate of recovery.

Operating costs especially staff costs are expected to be higher without any relief to be given from the Government’s Job Support Scheme. Rising energy prices due to global supply issues will also add to our cost pressures.

With the rising Omicron infections and possible emergence of new variants in Singapore, easing of COVID-19 curbs may slow. Hence, the Group continues to maintain a cautious outlook for the rest of the financial year.