ComfortDelGro profit down 31.5% to S$117.2m in H1, but earnings better than H2

A one-off gain from the Alperton property disposal in 2022 led to the difference.

ComfortDelGro (CDG) reported an operating profit of S$117.2m in the first half of 2023, a 31.5% decrease from the S$171.1m in profits in H1 2022. Majority of the difference came from a S$30.5m one-off gain from the disposal of Alperton property in London in the previous year.

Compared to the last six months of 2022, CDG’s operating profit is 18.5% higher.

An interim dividend of 2.90 cents per share has been announced, for a dividend payout ratio of 80% of PATMI.  

Improved public transport performance in Singapore, Australia, and the UK propelled recovery in the Q2 operating profit of CDG’s public transportation segment. Operating profit for the segment was S$29.1m in Q2, after logging S$23.3m in Q1.

In its taxi & private hire segment, operating profit improved to S$25.9m in Q2, from S$16.8m in Q1, thanks to lower tax rental discounts in Singapore. For the first six months of the year, the segment’s operating profit was S$42.7m, higher than the S$41.8m in H1 2022.

Beginning Q3, CDG is implementing a platform fee for rides booked via its Zig app, which it expects to contribute to this segment’s performance going forward.  

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ComfortDelGro managing director and group CEO Cheng Siak Kian noted that CDG’s overall performance has recovered post-COVID.

“Despite headwinds in some parts of the business, our overall performance has recovered. We have also seen this recovery accelerate in Q2, particularly in our core business of Public Transport and Taxi & Private Hire. To sustain this momentum, we are exploring new growth opportunities beyond our existing core business, particularly in the areas of electrification and autonomous vehicles,” Cheng said.

Updated dividend policy
Along with its latest financial results, CDG outlined its updated dividend policy, which is to pay out at least 70% of PATMI going forward, up from at least 50% of PATMI previously.

“We believe in rewarding our shareholders and are now committing to pay out at least 70% of PATMI going forward whilst concurrently pursuing growth opportunities,” Cheng said.

Cheng expressed confidence that CDG will achieve this, touting their stable cash flows and strong balance sheet. 

“ComfortDelGro is on the cusp of change. As a leader in land transport, we are committing to new technologies and future engines of growth. At the same time, we remain focused on our existing operations to improve core performance,” Cheng said.