Thursday, August 24, 2006
Well, I decided to pay a little bit more attention to what it says. According to Zao Bao, Comfort Delgro stated the following points:
1) It says that we should not make use of the profits of this "global company" to "mix up" with the talk of fare hike.
2) Half of the profits of Comfort Delgro are derived from overseas operations.
3) It says that if we want to see whether it is justifiable to raise bus fare or not, we should look at the financial report of SBS Transit.
4) According to the Zao Bao report, Comfort Delgro holds 75% of SBS Transit shares.
5) It says that from the quarterly financial report of SBS Transit, its profit has dropped by 3.9%.
6) It also says that the cost of fuel has increased by 40% for the past 1 year. Fuel cost takes up about 20% of their total operating costs.
7) As for staff cost, which make up of 50% of operation cost, it has increased by 3%.
Ok, these are the "facts" raise by the newspaper report. My stand is quite clear: if Comfort Delgro owns 75% of SBS Transit, any fare increase will of course benefit Comfort Delgro most! Besides, SBS Transit could be view as a subsidiary of Comfort Delgro. Thus, to see the impact of the fare increase and the validity of allowing such increase, we must of course take a wider approach, a bigger view.
For example, we cannot say GIC is badly managed just because it makes some losses in some of its investment, right? We must look at GIC as a whole entity. Similarly, when it comes to justifying whether a fare hike is necessary, we cannot just look at one small subsidiary's financial status and then claim that oh, it suffers financial burden, so we must let them increase price; even though when its mother company is enjoying a healthy annual growth in profits. Furthermore, which business in the world has the "immunity" from making losses?
Anyway, since the newspaper report mentioned about looking at SBS Transit financial report, so curiously, I did a search on both Comfort Delgro and SBS Transit financial report:
Comfort Delgro financial report at SES website:
SBS Transit Financial report at SES website:
From point 4, it says SBS Transit quarterly profit has dropped by 3.9. Taking a closer look at the financial report, this figure refers to the quarter to quarter comparison. i.e. compare to 2nd quarter 2005, 2006 2nd quater profit has dropped by 3.9%.
Well, fine. But when we look at point 6, claiming that cost of fuel has increased by 40%, I look at the quarter to quarter comparison, it has stated clearly that cost of fuel has only increased by 27.2%! So, where does the 40% come from? Even for half yearly comparison, the increase in fuel cost is only 36%. They round it up to 40%? This puzzles me alot.
And if you read further into the report analysis, you will realise that part of the increase in fuel cost is due to the increase of bus lines during that period!
Looking further at point 7, it claims that staff cost has increased by 3%. But I look at the financial report, it is actually 3.9% from the quarter to quarter comparison.What it did not mention is that turnover has increased by 5%!
But wait, aren't we suppose to be consistent in making comparison? Quarter to Quarter comparison is not a good comparison due to seasonal factors. I prefer to take a look at the half yearly comparison. To my shock, operating profits has only decreased by 0.7% instead of 3.9%!
Let me put it simply here,
Turnover>>>>>> +5.1%>>>>>>>>>>> +5.0%
Staff cost>>>> +3.9%>>>>>>>>>>>> +1.9%
Fuel cost>>>>> +27.2%>>>>>>>>>>> +36%
Ops profit>>>>> -3.9%>>>>>>>>>> -0.7%
Profit less tax>>No change>>>>>> +6.3%
We must bear in mind that the increase in fuel cost is partly due to the increase of new bus services introduced.
So now we know that they have only highlight the "higher cost" figures, but did not report on the increase of Turnover and the increase of profit less tax of 6.3%! If we look at the half yearly result, the increase in both staff and fuel cost was largely offset by the 5% increase in Turnover, resulting only a slight drop of 0.7% of operating profits.
Overall, profit less tax still enjoys a healthy 6.3% for the first half of this year!
So what do you think, should PTC allow them to increase fare?
Goh Meng Seng
Saturday, August 05, 2006
(My daughter Tian Ci)
Hope for the Future
Our present is moulded by our past and we mould the future at the present. Thus, our hope for the future lies in our hands now.
I have mentioned many times that my first initial real unhappiness with PAP was "created" back in 1997 when PAP started to use HDB upgrading as a threat (stick) and a carrot to win votes. In the midst of the bubble created by PAP's "asset enhancement" policy, this was truly "effective" as it touched on the raw primitive "greed" of human beings. Everyone thought that the property prices could go up on and on. Many people want to have "free upgrading" for their flats so that they could see their property prices soar. The whole nation was drown in the property bubble fuel by unrealistic expectation derived from PAP's "asset enhancement" policy.
There are basically three issues right here:
1) PAP has started politics linked with material returns for the first time (back in 1997). This is a big pandora box as human greed has no boundary.
2) Our children will be cultivated under such a system of materialistic setting which is detrimental to the progress of our society in encouraging volunteerism, social consciousness, justice and responsibility.
3) Such tactic is morally and politically questionable. Everyone has the obligation to pay tax and the government has the obligation to take care of EVERY SINGLE SINGAPOREAN. This is the basis of a republic nation but yet, PAP has advocated that only those voters who voted for them will have privileges?
I do not wish to see my children and future generations to be brought up in a society that only teaches them materialistic pettiness with little sense of social consciousness, equality and justice. This is my hope for our future and I really hope many more Singaporeans could share the same vision so that we could send an ultra strong signal to PAP that what it is doing is terribly wrong.
I also hope that my children will not live in an environment that promote gambling in the guise of "entertainment" and that the society will not be crippled by broken families, suicides and all sorts of social problems arise from casino gambling.
My hope for our future is to have a government that takes care of its citizens well instead of counting each and every cents for whatever little things we need from them.
My hope for our future is to have a government to take care of the elderly needs regardless of their votes; upgrade their lifts to land on each floor according to the needs of the elederly instead of petty politicking.
My hope for our future is to have higher return to our CPF savings so that our retirees could enjoy their life peacefully after so many years of working, without the need to go around begging, selling tissue papers or become scavangers hunting for empty cans at night. And yes, the GIC and Temasek Holdings should help citizens to get higher returns for their CPF savings instead of just serving the government's financial needs.
My hope for our future is to have stronger parliamentary setting whereby sufficient checks and balances could be installed by having more MPs from alternative parties. Monopoly of power is unhealthy for the progress of our nation. And I hope Singaporeans should learn from the NKF saga fast and come to the consensus that the multipartisan system is the only way to ensure good governance.
My hope for our future is that every Singaporean should not be "afraid" of going to hospital when they need to, just because they fear that they could not afford to pay for the hospital bills. Despite the claim of PAP that our healthcare system is "affordable" but the truth is, healthcare cost has been rising for the past years and many people still consider the cost of healthcare is not affordable to them.
National Day is around the corner and I wish all my readers a Happy National Day. On the other hand, I also hope that all of you could spend a moment of silent reflections on what we, as a Nation and a people, hope for our future generations.
Goh Meng Seng