SingPost

SingPost: 3QFY14 net profit was flat y/y at $39.4m although top line grew 30.2%, mainly due to Logistics (+64.5% y/y to $101.2m) on both organic and inorganic contributions, and mail business (+12.8% to $133.2m) as e-commerce package volumes continued to increase, boosting domestic and international mail revenue. Excluding contributions from acquisitions, revenue increased 9.3% in the quarter. Total expenses increased 34.4% to $184.4m mainly attributable to the change in business model to a diversified group and growth in lower margin businesses. Management highlighted that traditional mail business continued to be under pressure, particularly domestic mail volume which saw another quarter of decline. That said, management indicated transformation efforts are paying off with non-mail business now contributing 45.7% of Group revenue, up 10% from a year ago. Interim dividend of 1.25₵ /share declared for this quarter, translating to a 3Q annualized yield of 3.81% Latest broker ratings as follows: OCBC maintains Hold with unchanged TP of $1.32 UOBKH maintains Buy with reduced TP of $1.50 (from $1.53)