Tag: Asia

Singapore’s postal sector will be fully liberalised on April 1 this year. Basic domestic and international mail services – including collection and delivery of letters and postcards – will be opened to competition, after the 15-year monopoly of Singapore Post (SingPost) expires at the end of March.

The government said yesterday that the move – which was widely anticipated – could save businesses $8 million to $25 million a year over the next two to three years. Business mail makes up 95 per cent of total domestic mail.

Singapore’s postal services sector generated annual revenue of more than $1 billion – including $200 million from basic mail services – in 2004, according to the latest figures. Mail volume has been growing about 2 per cent per year in recent years.

‘We’re aware of the slow growth of the sector but we’re optimistic that with further liberalisation, we can introduce competition which will benefit customers. There are small but not insignificant cost savings,’ Minister for Information, Communication and the Arts Lee Boon Yang said at a news briefing yesterday. ‘The whole thrust of this is to help businesses reduce cost.’

‘We have received indications from postal services providers that they have an interest in entering the basic services market,’ said Dr Lee. ‘The intention is not to have a pre-determined number of operators.’

The potential impact on the earnings of SingPost is not expected to be of major concern – the group has been preparing for the loss of its monopoly by diversifying into non-postal services such as loans and pawnbroking.

Singapore Post has unveiled higher profits for the third quarter and the first nine months of its 2006/07 business year. The profitable company faces full competition in its lucrative domestic market within the next few months.

The Asian postal operator announced that its Q3 net profit increased 3.9% to USD34.2 million (euro17.2 million). Its operating profit improved by 6% to USD43.3 million on revenues up 3.5% to USD111.8 million.

Over the first nine months ending December 31, 2006, SingPost improved its net profit by 9.4% to USD101.6 million. The operating profit rose by 11.8% to USD127 million, while revenues were up 5.1% to USD323.4 million.

SingPost said that its mail business increased both operating profit and revenue in the third quarter, while logistics revenues benefits from higher contributions from Speedpost, the international express services operated in a joint venture with DHL Express. Cost reductions measures also generated profit growth.

Lau Boon Tuan, Group CEO of SingPost, commented: “In the third quarter, we further leveraged our retail network for growth, collaborating with our business partners to offer more value-added services and products including PostREALTY service and unit trusts.