SingPost’s transition into ecommerce and logistics is paying off, financial results show

SingPost has been more than just Singapore’s postal service for a while now. It’s adapted to the times and grown into an ecommerce logistics power player beyond the city-state’s tight borders – and it’s paying off. SingPost today announced its financial results for the first nine months of financial year 2015-2016, up until December 31, 2015. To paraphrase actor Sam McMurray on Friends, the lines all go up, so SingPost is happy.

The company reports revenue growth of 24.3 percent, reaching US$595 million, and a 17.6 percent rise in net profit to US$102 million. Part of this growth can be traced to SingPost’s ecommerce-related initiatives. Ecommerce revenue rose 53 percent and made up 33.4 percent of the group’s overall revenue, an increase from last year’s 27.1 percent.

The lines all go up, so SingPost is happy.

Revenue from overseas operations increased to 41.9 percent of the group’s overall revenue during this nine month period, up from 31 percent for the same period in the previous year. That means almost half of the group’s revenue now comes from overseas.

Revenue from logistics, retail, and ecommerce rose by including the numbers of new subsidiaries, like US companies TradeGlobal and Jagged Peak, acquired in October 2015.

Interestingly, mail revenue remained stable at US$265 million, even though the company got rid of stakes in Novation Solutions and DataPost. Ecommerce-related cross-border deliveries brought about an increase in international mail package volumes, compensating for reduced snail mail, that is, traditional letters sent through post.

See: In Southeast Asia, the real money is in logistics, not ecommerce

“Our transformation is showing in our financial results, which reflect how SingPost is on a new growth trajectory,” says Mervyn Lim, CEO of corporate services and group chief financial officer. “The investments we made in the last few years are driving up both top and bottom line growth, with group revenue up 24 percent and net profit 18 percent. With the integration of these acquisitions into existing operations, we can expect further synergies and expansion of our ecommerce business.”

Here’s a breakdown of the results SingPost announced for the first nine months of financial year 2015-2016:

The Singaporean company continues to reinvent itself in order to meet the demands of a modern, connected market, and seems to be doing a good job at it. Initiatives like the ecommerce logistics hub and the development of a retail mall have taken some serious cash – US$330 million including the acquisition of TradeGlobal – but they should further contribute to the company’s growth in the long term.

“Our transformation into a global end-to-end ecommerce logistics enabler is taking shape,” says Marcelo Wesseler, CEO of SingPost’s ecommerce group. “SingPost now processes US$3 billion of merchandise every year. We do this through more than 50 distribution centers across over 18 countries that include major ecommerce markets in the US, Europe, China, and the rest of the Asia Pacific.”