atans1

Posts Tagged ‘SMRT’

Olam: Hang on, buy for the ride?

In Africa, Commodities, Temasek on 18/03/2014 at 4:50 am

(Or “Temasek and Ho Ching haters getting more frus“)

Methinks that all those posters on TRE’s piece on Olam are banging their private parts real hard and crying in frustration http://www.tremeritus.com/2014/03/15/temasek-leads-consortium-to-buy-out-debt-ridden-olam/ . They missed making $ and are also upset that Temasek made gd (but peanutty ) money supporting Olam. Even those who pretend rationality while hating all things PAP ( s/o JBJ and Chris Balding?) can only sputter that if Olam is so gd, why buy now not earlier? May I suggest that they read FT’s Lex (behind paywall): squeezing the shorts leh; and Breakingviews (see below).

My tots on the stock: don’t tender the shares. Let’s go for the ride. At worse, kanna bot out if delisted. If buying lose only “peanuts” if kanna bot out. Remember my previous tots which TRE republished late last yr?

Last chance to buy Olam?

More bull points to add to this:

– When Olam released its quarterly results in early November, it showed it  had generated positive free cash flow – the first time in four years for a seasonally weak quarter.

Its executive director of finance and business development A Shekhar told analysts and reporters: “We’re very pleased that we’re striking the right notes on both objectives of profit growth as well as free cash-flow generation.”

– Ang mohs are still sceptical about the parts of the stock’s biz model.

– But they bulls on Africa and Olam got an edge there. Africa is now seen a destination mkt, not juz an exporter of commodities i.e. origination mkt:

The commodities houses are attracted to the African destination business for three reasons. First, demand is rising fast, in many cases at double-digit annual rates. Second, many African governments subsidise basic commodities such as petrol and wheat, in effect guaranteeing a return to the traders. Third, most African countries lack the infrastructure needed to import raw materials, from silos for storing wheat and rice to terminals for unloading petrol. The commodities houses say that, as they build this infrastructure, they will be able to secure a market and benefit from years of rising demand. (FT report on Africa dated 10 November 2013)

http://atans1.wordpress.com/2013/11/26/temasek-tales-tlc-overpaid-olam-cheong-wont-read-this-in-tre-toc/

This is what the deal’s all about (other than squeezing the shorts’ balls, hard real hard):

The most immediate beneficiary of the buyout is Olam’s creditworthiness. Despite Temasek’s minority shareholding, the company has faced persistent queries about its debt load. That’s particularly damaging for a trading house like Olam, which relies on the confidence of its counterparties. In future, creditors will view Olam as an extension of its sovereign parent.

http://blogs.reuters.com/breakingviews/2014/03/14/temasek-buyout-throws-sovereign-weight-behind-olam/

My next piece of advice to those TRE readers who keep on cursing Temasek and its CEO but who end-up banging banging their balls in frustration: Go analyse SMRT.

Trmasek and Ho Ching haters should come up with new lines of attack. The world has moved on from the crisis of 2007-2009. The recovery of global markets means that post Temasek’s losses on ABC Learning, Barclays and Merrill Lynch/BOA, performance has been in line with the recovery in world equity markets. Two of its dogs are dogs no more:  Shin is 50% up from its purchase price (though how to exit is an issue), and go check the price of Chesapeake. And the glee over Olam has turned to tears as Olam powers ahead, giving Muddy Waters a bloody nose. Big playpen bully has met a bigger bully. True blue S’poreans and xenophobes should be cheering Ho Ching on, not cursing her. But then hatred of the PAP is often irrational.

SMRT: only now meh?

In Infrastructure on 04/03/2014 at 4:55 am

I’ve only recovered from this piece of news on SMRT: on 16th Feb it was reported that “Singapore’s two train operators will adopt a “predict and prevent” approach to their maintenance regimes from now on.

‘Transport Minister Lui Tuck Yew said … this new approach will see operators actively monitoring the condition of the rail system to prevent breakdowns and delays.”* Seems they were using a find and fix” approach. Easiest way to “find” problems is sit back, drink kopi and wait for news of train delays, breakdowns?

Maybe taz why a CEO who is a scholar and ex-SAF chief is needed, not a Ferrari-driving FT retailer? Horses for courses?

Anyway now that SMRT is adopting state-of-the-art, cutting edge management techniques, time to buy stock? Stock set a new 52-week low during yesterday’s trading session when it touched 1.02. 36.7% down from a 52 weeks ago. That it yields 1.95% is a reflection that the price has collapsed.

DBS wrote this in 2012: SMRT has a dividend payout policy of at least 60% of net profit. In fact, in the past few years, it has paid over 70%, hence providing a reasonable yield.

ComfortDelGro, on the other hand, has paid only 50%of earnings as dividends. – See more at: http://sbr.com.sg/transport-logistics/markets-investing/smrt%E2%80%99s-dividends-risky-in-2012-dbs#sthash.k1ywpunr.dpuf

(Comfort yields 3.63%)

Surely after GE (next yr after August,  is my prediction), fares will be increased? Time to buy and wait now that mgt is better?

60% dividend policy. SMRT has a dividend payout policy of at least 60% of net profit. In fact, in the past few years, it has paid over 70%, hence providing a reasonable yield.
ComfortDelGro, on the other hand, has paid only 50%of earnings as dividends. – See more at: http://sbr.com.sg/transport-logistics/markets-investing/smrt%E2%80%99s-dividends-risky-in-2012-dbs#sthash.k1ywpunr.dpuf
60% dividend policy. SMRT has a dividend payout policy of at least 60% of net profit. In fact, in the past few years, it has paid over 70%, hence providing a reasonable yield.
ComfortDelGro, on the other hand, has paid only 50%of earnings as dividends. – See more at: http://sbr.com.sg/transport-logistics/markets-investing/smrt%E2%80%99s-dividends-risky-in-2012-dbs#sthash.k1ywpunr.dpuf

But then think again as NOL is run by another general and scholar and NOL recently lost serious money. Here’s analysis from last yr after an earlier set of results http://atans1.wordpress.com/2013/11/19/scholar-cant-repair-nol-maersk-steams-ahead/

——-

*Mr Lui was responding to questions from Members of Parliament on the reliability of train services, in the wake of several disruptions last month, including a delay on the North-South Line that affected some 19,000 peak-hour commuters.

So far, operators SMRT and SBS Transit have been using the “find and fix” approach to correct existing issues with their rail systems.

Mr Lui said he had called up SMRT’s senior management to convey his concerns after the recent spate of incidents.

He said: “They take it seriously, and as the CEO told me himself… the team was actually very disappointed themselves with the series of incidents, as well as with how the staff on the ground had handled it.”

SMRT will be reviewing its contingency plans on a station-by-station basis to better support its ground staff, rather than rely on a generic plan that covers stretches of the network.

Mr Lui said: “SMRT’s management has already committed to review its contingency plans on a station-by-station basis, and refine its command and control structure in times of disruption to better support ground staff.”

Both SMRT and SBS Transit have also switched to a “predict and prevent” strategy for their maintenance regimes.

For instance, some trains on the North-South and East-West lines are already equipped to collect real-time data and detect problems as they run.

Several MPs had asked why train disruptions continue despite efforts in recent years to improve the train services.

Mr Lui said: “Service disruptions do happen from time to time, especially as our rail network further expands and ages, and as we run more and more train trips.

“But in the case of the January incidents, SMRT could have done much better in service recovery, especially to provide timely information to affected commuters.”

Both train operators, however, have put in hard work to improve train reliability since 2011, Mr Lui added.

Government estimates showed that SMRT has increased its yearly repair and maintenance expenses by over 65 per cent from S$38.3 million in 2011 to S$64.6 million last year.

Both train operators have also hired more engineers and expanded their maintenance teams.

The Land Transport Authority is also upgrading the rail infrastructure.

The North-South, East-West lines’ third rail system will undergo a full, system-wide change-out this year, Mr Lui said, and the North-East Line’s overhead power system will also be improved with new corrosion-resistant materials to minimise cracking in its components.

In a separate statement, SMRT said it takes responsibility for the recent incidents, and will leave no stone unturned to improve the reliability of its train services. (CNA report)

SMRT: Update

In Infrastructure on 06/02/2014 at 4:38 am

.There could be a rights issue coming to shore up its finances. But to call it, it must be pretty sure of profits for dividends somewhere down the line. Massive train price increase after 2015 GE?  Don’t see PAP losing power or even losing a two-thirds majority. Or even PritamS becoming a cabinet minister in a PAP, WP coalition govt.

But remember the CEO is an ex-SAF chief, juz like in that dog with fleas, NOL :http://atans1.wordpress.com/2013/11/19/scholar-cant-repair-nol-maersk-steams-ahead/

Good article on SMRT by someone whom I don’t usually think highly of: http://www.baldingsworld.com/2014/01/29/why-is-smrt-raising-fares/

This video has been making the rounds on Facebook: During a 45 train delay, SMRT begs passengers on board repeatedly for a pair of scissors

Taz why PTC raised fares. After paying Kwek and his SAF buddies, got no $ for proper tool box? LOL

Gd reports

– SBS (ComfortDelgro)  benefits more than SMRT from price hike

http://sbr.com.sg/transport-logistics/news/chart-day-these-charts-show-how-transport-firms-will-be-impacted-fare-hike

– Sports Hub to make $ for SMRT

http://sbr.com.sg/transport-logistics/news/singapore-sports-hub-could-turn-around-souring-smrt-profits

 

Another reason why SMRT sucks

In Infrastructure on 27/01/2014 at 4:27 am

Last Monday, I made one of my irregular trips on the MRT. I entered Eunos Stn in the late morning and one of the escaltors was closed “for maintenance”. I returned home via another route partly to avoid walking down the stairs on the return journey

Last Friday, I again took the MRT from Eunos Stn. Guess what? The escalator was still closed for “for maintenance”. When I made the return trip (wanted to eat at a great but expensive Malay food stall at Eunos Hawkers’ centre: stall always asking why I don’t eat more regularly and I explain to them I don’t use the MRT that often), several hours later, the escalator was still not working.

Err how to expect train services not to be disrupted (five already this yr according to TRE*) if cannot even repair or service escalator within five days? But to be fair, maybe engineers too busy repairing tracks etc to bother about escalator. Got to prioritise everything, according to jnr tpt minister Jos Teo.

I will have to again use the MRT from Eunos this Wednesday and then the following Monday (yah lot of travelling these few weeks: pushing my luck leh), and I’ll keep readers informed.

Meanwhile, avoid the stock. It’s going to take huge fare rises to make it a gd dividend yielding stock again because it needs to spend more, a lot more to get (and then keep) the trains running on time. With an election likely in 2015, these fare increases are unlikely http://atans1.wordpress.com/2013/12/13/why-a-2015-ge-is-now-more-probable/

Meanwhile, I wish MRT users a disruption free day, though the odds are rising against this probability.

Thinking about it, SMRT may have closed one of the Eunos escalators to save money as per this story about the London MRT (tube) system.

Green Park is one of the busiest tube stations in London. It has three escalators to the station concourse from the Piccadilly line, which serves not just London commuters but international businessmen and tourists travelling to and from Heathrow. Yet routinely one is closed at peak times.

The reason? According to station staff Green Park has been set energy targets and this is the way that it is meeting them.

So, in order to meet this energy-saving goal, the London Underground is prepared to cause unnecessary delays to passengers, even though time-saving for passengers is always a crucial element in any evaluation of a transport project. It is also prepared to create potential dangers to public safety as bunching occurs while people wait for the only up escalator that is operating. And as that happens another escalator stands idle, with the big investment that has been made in it in effect written off.

What folly. Whether or not this is intended by the top brass at Transport for London is unclear. But this is what happens when stupid objectives are set and managers are either pressured into meeting them come what may or follow them without paying heed to their primary responsibility, which in the case of a tube station is to convey passengers as swiftly and as safely as possible to and from the trains. (http://www.economist.com/blogs/blighty/2014/01/trouble-targets)

Hmm, thinking about it, the setting of stupid objectives, and why the absence of the profit-motive when providing public services (like transport) is not a gd idea, may be the subject of posts after the CNY hols. Must try to stop writing about ang moh tua kee Bernice Wong and her masculine, not sheltered, babyed & childish (so unlike local boyars) hubbie, Anton Casey.

*Or is it four http://www.tremeritus.com/2014/01/26/smrt-5th-smrt-breakdown-not-a-breakdown/ (Updated one hour after first publication)

Tpt minister looks after shareholders, the poor and the disabled?

In Infrastructure, Public Administration on 15/01/2014 at 4:27 am

What about other disadvantaged S’poreans?

The Public Transport Council (PTC) will release its decision on raising fare adjustments for public transport tomorrow and a reasonable person would conclude that fares will go up based on what Minister for Transport Lui Tuck Yew wrote  on a Facebook post on Monday.

“I told (PTC chairman Gerard Ee) that the government was ready with our package for the low-income workers and persons with disabilities and that we would like to announce this together on Thursday. These two concession schemes will be fully funded by the government,” wrote Mr Lui, stressing that the schemes would make transport fares much more affordable for both groups.

Isn’t he telling the PTO, pls feel free to help out the tpt companies (and their shareholders*) because the govt (us tax-payers, including said poor and disabled: remember that they too pay GST) will absorb the increases for said groups.

Mr Lui also said that the discount under the scheme for low-income workers would lower their fares to around the same levels as 10-15 years ago, depending on the journey. Meanwhile, the discount for those with disabilities will be “even more significant”.

Hey what about retirees and those who never got pay rises?

BTW, the WP’s silence on nationalisation is deafening, even though WP Low told us last yr that WP still believes in it. I have my doubts  http://atans1.wordpress.com/2012/12/14/wp-changes-mind-on-nationalising-smrt-sbs/

Backgrounder: In December, transport operators SBS Transit (SBST) and SMRT applied to the PTC to raise bus and rail fares this year, with SBS – Singapore’s biggest bus operator – citing cost pressures.

—–

*Some shareholders do get a free lunch:despite claims by scholar and ex-general running SMRT that its biz model is broken:

Using back-of-the envelope calculations and figures in annual reports, since it was listed SMRT (over a decade ago) has paid S$562.79m in dividends to Temasek, and ComfortDelgro has paid the S’pore Labour Foundation (a statutory board affiliated to the NTUC) dividends of  S$150.46m*since 2003 (Comfort and Delgro merged in 2003, and SLF had a stake in Comfort). The amount that ended up with the government was S$713.25m, with SMRT contributing 79%. But ComfortDelgro is likely be the main beneficiary of the S$1.1bn bus plan**, given that, at present, SBS Transit (a listed co 75% owned by ComfortDelgro) provides most of the buses. Taz an example of how messed up things are.

The funds’ flows also show that the government is putting back all the dividends it received from these two companies and then adding 35% more. So it’s wrong to say that the SMRT and ComfortDelgro are getting free lunches. At most the government is subsidising their lunches by 35%.

The government should get credit for ploughing its share of the “loot” (as the proponents of nationalisation would put it and MPs Puthu, PAP, and PritamS, WP, might put it), but it doesn’t. Taz how messed up are.

(Incidentally, one could reasonably argue that the other shareholders — and the minority shareholders of SBS Transit, remember ComfortDelgro owns around 75% – are getting a free lunch while the government returns its share of the dividends. But let’s nt get into that today.)

http://atans1.wordpress.com/2012/03/02/oh-what-a-tangled-web-we-weave-mrt-comfortdelgro-and-the-government/

Small wonder that foreigners snapped up ComfortDelgro at gd discount last year though tapering caused some wobbles http://atans1.wordpress.com/2013/06/17/when-raising-fares-sbs-smrt-govt-dont-have-this-problem/. Now above price bot. in.

.

Central bank cautions on Reits

In Property, Reits on 12/12/2013 at 6:02 am

[A] Monetary Authority of Singapore (MAS) report … warned that a rise in rates will hit Reits – and lower their dividends.

Reits own a portfolio of property and pay investors regular dividends out of their income – the property rentals received.

The central bank’s financial stability review noted that Reits need to distribute 90 per cent of any taxable income to unitholders.

So these vehicles have limited retained earnings and are dependent on capital markets and banks to meet their financing needs.

The MAS estimated that the ease with which Singapore-listed Reits would be able to pay their interest bills would fall markedly once interest rates headed north.

The median “interest cover” for Singapore-listed Reits would fall from 6.8 to 3.5 times if interest rates were to rise by 3 percentage points, the MAS estimated.

The interest cover is a ratio used to determine how easily a company can pay interest on its debt – the higher the ratio, the easier the interest can be paid.

The MAS also warned that higher interest rates would likely increase interest expenses and lead to lower dividend payouts. Reits might then appeal less to investors, capping their ability to raise more cash from capital markets.

On the bright side, the debt maturity profile of Reits is better now than before the global financial crisis in 2008 and 2009.

A smaller proportion of borrowings by Reits are due for refinancing in the next two years.

The MAS also issued a warning over the larger corporate sector.

“If interest rates were to rise from their currently low levels, firms’ debt-servicing burdens could increase significantly.”

http://www.cpf.gov.sg/imsavvy/infohub_article.asp?readid={1011063489-19666-9955500363}

Don’t blame govt if Reits tank after you buy buy.

Possible gd alt to Reits for the KS: http://atans1.wordpress.com/2013/10/03/temaseks-fab-5-spore-blue-chips/. While the yields are not as high, some pretty lowish in fact, they are not highly leveraged and have maintained steady pay-outs.  And think ComfortDelgro and even SMRT (fare rises leh)

Related post: http://atans1.wordpress.com/2013/11/14/where-reits-can-go-wrong/

SMRT: Rights issue coming?

In Infrastructure on 08/10/2013 at 5:54 am

Reading the u/m, I can’t shake the feeling that a rights issue is coming: the capex and running costs seem to call for it. Given that the share price has fallen from the 1.40ish level (at the end of July), to the present level of 1.29, it  might be interesting to buy if one expects a rights issue is in the offing. A rights issue will signal that Temasek expects dividend levels to be maintained at current levels, or slightly reduced, not slashed drastically. It took the results of 1Q 2013- 2014 to bring the shares to below the 1.34 level, a level brokers had been targeting since January.

Let you know if I buy after I buy. BTW, still not bot ComfortDelgro http://atans1.wordpress.com/2013/06/17/when-raising-fares-sbs-smrt-govt-dont-have-this-problem/. Share price recovered 10% while I was thinking about it (blame QE reprieve). Shares are now near the price that institutions took a placement off the S’pore Labour Foundation.

CREDIT ratings agency Standard & Poor’s (S&P) has lowered its outlook on SMRT Corp from “stable” to “negative” over concerns about its financial position, particularly its cash flow.

S&P said [on 27th September 2013] that the transport operator’s operating expenses are higher than expected. It also pointed to high capital spending over the 12 months to June, while noting the uncertainty over government financial support such as funding for the firm.

http://www.cpf.gov.sg/imsavvy/infohub_article.asp?readid={435478142-19258-9361788629}

“… the lack of timely government support could delay a recovery in SMRT’s key financial metrics.”

SMRT’s “moderate” financial risk profile is weakening, S&P added.

It said it expects the group’s bottom line will be hit by increased operating expenses such as wages and repair and maintenance costs, without the offsetting factor of higher fares.

S&P added that SMRT’s capital expenditure will likely remain high at about $600 million.

It noted that the group’s capital spending will likely ease in 2015 as it implements a new rail financing framework. This, in turn, will ease its debt situation.

“Nevertheless, we base this on a positive and timely outcome for the ongoing discussions between the company and the Government.”

S&P said SMRT’s business risk profile remains “excellent”, backed by its dominance in Singapore’s rail sector.

Its passenger numbers have grown steadily over the past two years despite breakdowns in December 2011.

The agency predicts that passenger numbers will continue to rise as the economic environment improves and it retains its dominant position here.

S&P continues to believe that the likelihood of “extraordinary government support” for SMRT Corp is “extremely high”.

It said: “This is based on the company’s critical role as a provider of essential public transport service in Singapore, and its very strong link with its majority owner, the Government, through Temasek Holdings, which owns 54.2 per cent of SMRT.”

TRE to blame?

In Humour on 25/09/2013 at 5:21 am

The appointment of SMRT’s security chief as its new PR chief* reminded me that In a letter dated 3 September 2013, a TRE reader sent in a complaint about some PRC FTs at a MRT station

They were eating foods such as Biscuits, Cakes, Lychees, Bananas and Apples, taken out from several boxes and plastic bags. The lychees peeled skins were littered on the concrete bench/seat. They were also shouting loudly in a distinct China’s Chinese accent. I also observed that they were loitering; not boarding any trains travelling towards Joo Koon or Woodlands MRT. They were literally having a picnic.

I did not stop them to minimise the possibility of myself getting hurt, as I have read several reports of China nationals attacking Singaporean Police officers. e.g. (source: TR Emeritus)

He complained to the SMRT staff but didn’t know the outcome as he had to catch his train and TRE wrote: Editor’s note: A letter has been sent to SMRT for comments on why the foreigners were not fined on the spot.

Maybe the SMRT person too read TRE’s reports of aggressive PRC behaviour and decided he too didn’t want to get beaten up, juz like the letter writer? There was an incident also reported by TRE about a PRC PR shop assistant who beat up a SMRT officer because the officer had stopped her son for trying to avoid paying.

So maybe TRE should be more careful in highlighting PRCs aggressive behaviour towards S’poreans to avoid unnecessarily frightening S’poreans.

Wonder if SMRT ever replied to TRE?

*Let’s hope this ex-cop improves on this

http://atans1.wordpress.com/2013/07/29/smrt-another-breakdown/

http://atans1.wordpress.com/2012/11/16/smrt-is-in-the-biz-of-transporting-people/

http://atans1.wordpress.com/2011/12/18/smrt-svp-is-great-believer-in-shareholder-value/

“Cheaper” to build F1 track

In Humour, Infrastructure on 08/09/2013 at 6:21 am

Netizens in July were making comments about a SMRT river training for F1 following a tragic accident when a bus alleged to be speeding overturned. The driver (apparently an FT PRC) claims the brakes didn’t work. http://www.tremeritus.com/2013/07/24/smrt-bus-crash-at-dairy-farm-road-actual-video-of-crash/. Nothing further has emerged.

For us lesser mortals, when F1 comes to town, those of us who have to work, have the inconvenience of blocked roads and altered bus routes. And the shops at Suntec have to deal with falling biz. All this so that S’pore doesn’t have to build a proper F1 track. Guess we now know why only Monaco, Montreal and S’pore have street races: peanuts compared to the number on permanent circuits. The public are inconvenienced, and the public cannot be upset even in countries where the people can’t vote for the govt ruling them. BTW, in Montreal, the street race ain’t in the heart of the city, and in Monaco, people commute by helicopters and boats too (at least the rich do).

It’s not as though there is a huge savings gap. In fact it’s more expensive to stage a street race, even without taking account of the economic losses.

However, the annual running costs of a street race are greater than those of one on a permanent circuit: temporary grandstands need to be built and the roads need to be upgraded to F1′s high safety standards. The biggest single expense for the operators is staffing (c£10m), followed by rental of grandstands (c£8m) and construction of safety barriers and fencing (c£5m). 

In total, the annual operating cost of an F1 street race is in the region of £36m. Then comes the hosting fee, which is paid to the F1 rights holder. The average hosting fee came to £17m in 2011 but the sting in the tail of the contracts is that the price accelerates by as much as 10 per cent every year. Most new F1 race contracts are for ten years, so by the end of the agreement the annual fee comes to around £40m thanks to the escalator clause in the contract. That means that over the ten-year duration the bill for hosting fees totals an estimated £272m (see below) with the cost of running the races coming to £360m. That makes a total over ten years of more than £600m.

With annual running costs that are far lower than those for a street race, the total cost of building a Grand Prix circuit and hosting an F1 race over a ten-year period comes in at around £560m. But promoters need to dig deep to fund that initial track construction… http://www.babusinesslife.com/Ideas/Features/The-cost-of-hosting-a-Formula-1-Grand-Prix.html … how much the key elements of a brand new Grand Prix circuit are likely to cost… [£164m]

So the difference is spending S$80m more over 10 yrs to “save” on the cost of building a permanent track. Of course, I ‘m assuming the cost of the circuit land is zero or nominal. But this being S’pore where giving away the land for public housing would be “raiding the reserves” (Mah Bow Tan), this is a non-starter. Anyway the usual suspects would shout “corruption” even if the govt was willing to lease land at a nominal price.

So, the end result is that the “little people” who have to commute by way of public transport, get screwed, So waz new?

(Related post: http://atans1.wordpress.com/2012/10/01/f1-sharing-the-1bn-in-value-add-with-the-losers/)

But let’s look on the bright side like Brian Cohen in the Life of Brian. Suffering a lingering, painful death by cruxification, Brian’s spirits were lifted by others crucified along with him, who sang “Always Look on the Bright Side of Life”.

Hopefully SMRT and SBS are tapping F1 to make our tpt system more reliable and efficient. In the UK, train and bus companies have started working with the Williams Formula One team to help improve their service.

The companies are buying advice and equipment to make their vehicles more reliable, something every passenger in the land will be grateful for.

http://www.bbc.co.uk/news/business-23132335

At the moment, SMRT’s only links with F1 is that the previous CEO drove a Ferrari, and is alleged to have had a Mercedes super car. Maybe when Desond Kwek and his ex-SAF mgrs want to buy super cars with their mega-bonuses, Williams could call them to see if something win-win can be arranged for them, Williams and SMRT? Free sex is no longer an option after recent corruption court cases.

SMRT might be interested in this: talking train window ads

http://www.bbc.co.uk/news/technology-23167112

I mean its CEO is claiming that its business model is not sustainable i.e. he can’t raise fares to cover the costs of salaries and maintenance. Cut dividends leh? As at end February 2012, SMRT has paid SMRT paid S$562.79m in dividends to Temasek since its listing.

(Another way of raising $http://atans1.wordpress.com/2012/08/13/how-smrt-can-spend-more-on-maintenance-while-contd-paying-gd-dividends/)

Finally, great video that shows guy driving round Manhattan at speeds that breaks the law. http://www.theguardian.com/world/video/2013/sep/06/manhattan-island-24-minutes-video. Driver records 24-minute fastest lap around Manhattan

SMRT: Another breakdown!

In Infrastructure on 29/07/2013 at 10:49 am

Fortunately it’s not the trains, or the buses. It’s minor. Shares are marginally off today, so market doesn’t worry about this latest dyfunctionality

Still even think about investing in it because the continuing dysfunctionality  is not reassuring, inspite of having as CEO, a scholar and ex SAF head, who was brought in to get the trains (and buses) to run on time again. Still not running. There have been several train delays, the most publicised of which was in April when a crack on the northbound track between Somerset and Orchard stations slowed trains to a crawl. Then a speeding bus (driven by FT PRC driver training for F1) crashed overturned.There were injuries and a death. And then there was S’pore’s first strike (legal or otherwise) in decades.

All this on the watch of a scholar and general? Err what would have happened on the watch of a non-scholar, sales char bor FT? Actually, we know: overcrowded trains, poor working conditions for FT drivers, contempt for commuters.

Back to the latest failure: SMRT’s Vice President for Corporate Marketing and Communications, Ms Kalai Natarajan, has quit after only 5 months. She was among several senior management staff (mostly ex-SAF officers, but not her) brought in by the new CEO Lt Gen (NS) Desmond Kuek after he took over in Oct last year. She was hired in Feb this year, taking over from Mr Goh Chee Kong, who left last year. Mr Goh is the guy who insinuated, “Better you die, than damage SMRT property.” OK, I exaggerate, but not by much. He was ex-SAFer. (Her quitting shows the gd for the FT, where “T” stands for “Talent”, running Temasek’s public communications. I once blogged that he had turned down the SMRT post.)

During her short tenure, more than five in her communication team of about 10 people resigned.

According to ST, her departure is unusual because she is not required to serve notice. She told ST that she is leaving SMRT today (Monday). She confirmed that she will not be serving notice. Usually the notice period for senior management is three months. Seems she hasn’t another job waiting for her.

A HR expert speculated in ST report that there may be a “cultural misfit” if senior management staff “are not on the same wavelength”. Let’s watch to see if the Hongkie that was brought in to run train operations, quits.

If he does, then commuters should be worried, very worried, that experienced professionals have left, leaving only ex-SAFers, not experienced in running public transport operations or public communications.

Related posts: http://atans1.wordpress.com/2013/05/05/smrt-can-still-wait/ Interesting that it is still trading way above its “Sell” target price.

http://atans1.wordpress.com/2012/11/27/for-they-have-sown-the-wind-and-they-shall-reap-the-whirlwind/

When raising fares, SBS, SMRT & Govt don’t have this problem

In Infrastructure on 17/06/2013 at 5:33 am

SBS and SMRT are grumbling loudly that their present biz model (after delivering golden rivers of dividends for Temasek and the S’pore Labour Foundation) doesn’t work. SLF even sold 8% of SBS’s parent at a huge discount to the market price. Great move as this was done before market meltdown. (BTW, at current price, tempted to buy into ComfortDelgro. It closed last Friday at 1.755, up 3% from Thursday. The co’s fundamentals havenot changed since institutions bought SLF’s stake at 1.94. It is likely that when they bot from SLF, they would have been given assurances of the fundamentals at that price.)

And govt has been pouring our money ($1.1bn and counting) at the public the transport system. And the Wankers’ Party remains quiet* about its Manifesto call to nationalise the public transport system.

If the PAP govt weren’t concerned that it would lose votes if fares were raised without a marked improvement in service standards, fares would have gone up by now to keep the dividends flowing. Screwing the public (by making the public pay-and-pay) is the PAP way pre the 2011 GE and PE.

Anyway, SMRT, ComfortDelgro and the govt should be grateful that this doesn’t happen here when faresw are raised: Protests against bus and underground fare rises in the Brazilian city of Sao Paulo have turned violent.

Police fired rubber-coated bullets and tear gas, and detained more than 200 people. Police say they seized petrol bombs, knives and drugs.

Violence has also been reported at protests in Rio de Janeiro.

Prices for a single ticket in Sao Paulo were raised on 2 June from 3 reals ($1.40, £0.90) to 3.20 reals ($1.50, £0.96).

http://www.bbc.co.uk/news/world-latin-america-22899748

For that, they have to thank people like this TRE reader

My Middle name is AhLong:

We need to organise a movement similar to BERSEH of Malaysia now to demand clean election. We need to ensure a proper way to secure and account for the ballot boxes en-route to the counting station …We must demand at the counting station, after all ballot boxes are accounted for and examined, all the ballot tickets should mixed into a single bunch and count from there. In this way, the sly election department will not be able to get the data for gerrymandering in the next election.

Finally, to have a level of playing field, election department should NOT be under PMO!

If he is serious, he should be trying to organise shumething, instead of juz bitching anon. His use of the word “We” is simply a way of saying “You”.He juz wants to let out hot air, like VivianB, Auntie and her favourite Singh, the M’sian gals from S’pore Writers, and the Nairs, Gopalan and Rajan. He doesn’t want to do the hard slog, like Low, Ah Huat, Ah Lian, the NSP’s Dynamic Duo, the Ravis (M and P) and Team SDP. If you’re wondering why Siow is not on the list, he’s away in the US until year-end. And no, he is not attending the CIA’s regime change course.

*To be fair, Low mentions it in passing, now and then.

LTA, SMRT: Learn from NY & Dubai pls

In Infrastructure on 04/06/2013 at 5:48 pm

“Sponsorship is already used on metro systems across the word in places like Madrid, Dubai and New York,” says a Tory party report, and it suggests “Sponsorship deals to rename London Underground lines and stations should be considered as a way to fund a freeze in fares, Tory politicians have said.”

A report by the Conservative Party on the London Assembly said if £136m was raised in sponsorship it could freeze fares for a year.And it claimed £204m would cap rises at inflation for the next three years.

http://www.bbc.co.uk/news/uk-england-london-22745677

“Transport for London (TfL) said the cost of of changing maps and signs made a deal of that kind unfeasible”, and bet you that LTA and SMRT would give the same excuse.

But here’s shumething that SMRT cannot say, “Every penny of this and our other revenue goes towards keeping fares as low as possible”,. because as a listco, controlled by Temasek, it got to pay dividends.

SMRT/ LTA: Another PR problem round the corner?

In Infrastructure on 07/05/2013 at 5:06 am

Questions have been raised over the health impact of high levels of tiny airborne metal particles discovered in a European underground train system.

Millions of people travel on underground urban transit systems in cities across the world.

Researchers at Southampton University say metal in the air thrown up by trains running on metal tracks could pose a health risk.

Airborne particles small enough to be inhaled are known to damage health.

They increase the risk of developing asthma, lung cancer or cardiovascular disease.

http://www.bbc.co.uk/news/health-22404446

Related post: http://atans1.wordpress.com/2013/05/05/smrt-can-still-wait/

 

SMRT: Can still wait

In Infrastructure on 05/05/2013 at 5:15 am

SMRT’s FY2013 profit missed expectations as cost inflation outpaced revenue growth. Margin pain will persist until SMRT moves to a more sustainable business model. Until then, not only are profits at risk, so are dividends.

Dividend payout was cut to 45 per cent versus its previous 60 per cent policy. FY2013 core net profit met only 92 per cent of our and consensus estimates. We cut our FY2014-15 EPS estimates by 21 to 27 per cent and introduce FY2016. Our target price (discounted cash flow, weighted average cost of capital 6.5 per cent) falls to $1.26. CIMB April 30.

The last target price I saw, six months ago I think, put it at 1.33. Not sure whose.

Buying for yield requires co to have a sustainable business model, something that SMRT admits it doesn’t have. Keep on watching.

 

TRE says it all about Ong Ye Kung, NTUC & SMRT

In Humour on 10/04/2013 at 6:54 am
TRE posted these articles in the following order on its front page.
NTUC claims credit for unionising SMRT PRC bus drivers

NTUC claims credit for unionising SMRT PRC bus drivers

In a recent hour-long phone interview with 2 journalists from Yahoo! Singapore, former SMRT bus driver…
185 SMRT PRC bus drivers had petitioned MOM in 2010

185 SMRT PRC bus drivers had petitioned MOM in 2010

 

Ong Ye Kung as a director of SMRT should have known about the plight of the bus drivers. But as union leader of the bus driver, he did nothing. And NTUC is now claiming credit for unionisg PRC drivers? Why now only after a strike? But let’s be fair, maybe NTUC leaders are like the many readers of TRE who “hate” all things PRC. See all the negative stories TRE carries from the Western media about China which pander to these readers.

 

When ST headline is bullish, time to sell?

In Financial competency, Property, Reits on 11/02/2013 at 9:33 am

In SunT, the headline screamed,”Market risks ‘seem less threatening this year’”. Oh, dear. If ST reporters and editors are getting less cautious, isn’t this a contrarian sign. Maybe? But to be fair the forecast was made by a UOB Asset Management executive.

So far, as well documented here, I’ve been emphasising buying stocks with sustainable dividends or payouts, decent yields (slightly above our 5% inflation rate), with the possibility of capital appreciation. I’ve been long on smaller cap S-Reits that have tai-kors with money for several yrs. I’m not a buyer at these levels, but neither am I a seller. I’m a nervous holder. Until you cash out, the profits can evaporate. Taz why good, sustainable yields are important. But that means taking on more risk: Reits are not a play safe investment. Their gearing and the requirement to pay out 90% of their earnings, could result in investors coughing up in rights issue more than they got in payouts. Taz the reason for my nervousness.

Stocks on my watch list are SBS and SMRT. But they’ve been on my to buy watch list for three years already.

 

 

 

SMRT: Dump

In Infrastructure on 31/01/2013 at 5:15 am

Brokers had forecast cost increases in staff, repair and maintenance costs, but not the 29.1% in maintenance & repair; and the 18.2% in staffing costs (all those new recruits from SAF?*) reported this quarter.

Brokers are putting a target price of around 1.34, a big drop.

But maybe there is the usually Biz School approved front-loading of costs, expenses whenever there is a new CEO. For yield buyers like me, the next Q’s numbers are awaited.

——

*http://atans1.wordpress.com/2013/01/21/smrt-noticed/

 

 

 

More FTs on way, a lot MORE!: DBS

In Economy, Infrastructure, Political economy on 22/01/2013 at 6:29 am

OK, OK, I exaggerate: only 8% more of population if S’poreans don’t start breeding like rabbits.

DBS Vickers expects an upcoming white paper on Singapore’s population to raise its population target to 7 million from 6.5 million, which will benefit construction, land transport, property and healthcare companies. http://www.reuters.com/article/2013/01/18/markets-singapore-stocksnews-population-idUSL4N0AN3GR20130118

SMRT is not on the “buy” list. It too has concerns about SMRT, like me and many others.

SMRT: Noticed?

In Infrastructure on 21/01/2013 at 5:45 am

I had planned to blog on the new appointments http://www.sammyboy.com/showthread.php?138562-8-New-hires-to-get-SMRT-on-track-4-from-military but forgot until today. Old age.

Noticed that SMRT has created seven new posts? Looks like Kuekie wants to spend, spend, spend on expanding management.He must think SMRT like SAF, money not an issue.

Taz two reasons to avoid the stock. The only reason to buy is to capture the gains from increased fares. But I’m not sure if fares would be allowed to rise this year, let alone this side of next GE: unless there is a marked improvement in service.

And speaking about service, on Boxing Day, for the first time ever, I couldn’t board a train because it was full: I didn’t have the right to board a crowded train, it was too crowded. It was at noon at Bishan. Note, I avoid using MRT and buses during rush hrs. And on Boxing Day and 31st Dec, there were problems when I used the NE Line.

SMRT: Buying target price

In Infrastructure on 20/12/2012 at 7:03 am

OSK DMG has a target price of $1.60 (6% above current price) and a Neutral call. I’ll monitor price to see if it falls to below or near that level. And then evaluate it to see if worth buying for dividend yield. The CEO’s talk of getting rid of FT drivers’ supervisors, could if carried out herald a change of culture.

BTW broker has a  Nneutral” call on the sector, with preference for ComfortDelGro (S$1.72 BUY TP S$1.85) for its cheaper valuations and overseas growth potential.

WP changes mind on nationalising SMRT & SBS

In Political governance on 14/12/2012 at 6:08 am

This blog at regular intervals reminds readers that the Wankers’ Workers’ Party had been silent on public transport nationalisation, despite it being in the Wayangs’ party’s 2011 manifesto and despite Gerald Giam advocating it in ST in July 2011 (here, here); and despite the seeming failure of the govt’s public tpt policy (I mean does the pumping in of S$1.1bn show that the “for-profit” policy working?)

Finally WP and GG have broken their silence: “If PTOs are unable to do so because of their obligations to shareholders, public transport should be taken out of private hands and run by a not-for-profit corporation which focuses on providing efficient and quality public transport, instead of generating shareholder returns.”

Err this was what is written in Manifesto: “Instead of public transport being provided by profit-oriented companies, all public transport including the MRT & public buses servicing major routes should be brought under a National Transport Corporation, a public body, to ensure a smooth integration of the overall national transport network and to avoid unnecessary duplication of services and overheads incurred by multiple operators.”

Spot the difference? The Manifesto call was unconditional. Now the operative word is “IF”.

Second time WP changing its mind on a Manifesto call. The first was on the benchmarking of ministers’ salaries. Like this change, one GG was behind that one too. Maybe Eric Tan (remember him?*) was right to rubbisg GG.

If the Manifesto is juz toilet paper, pls tell us WP. And tell us which first-world opposition party treats its manifesto with such contempt?

Related post

http://atans1.wordpress.com/2012/11/23/why-wp-mps-are-not-first-world-parlimentarians/

*GG called him his Si-Fu. Si-Fu lost NCMP seat to GG. Si-Fu had been promised NCMP seat before GE 2011, if East Coast team was entitled to one.

Meritocracy’s feet of clay: Ong Ye Kung

In Corporate governance, Political economy, Political governance on 10/12/2012 at 5:29 am

(Update on 3 January 2013: He has joined Keppel Gp, a TLC, and not as expected his father-in-law’s property company. I’ll be blogging on this next week. Want to try to find out if his in-laws scared that their workers’ will go on strike or be unhappy if he joined them. I mean his record at SMRT/ NTUC not too good.)

Our nation-building constructive media are ignoring the white elephant in the space where of the circles of TLCs/GLCs, PAP, NTUC and the civil service meet: sometimes also known as S’pore Inc.

Once upon a time, Ong Ye Kung, was S’pore Inc’s poster boy of meritocracy.

Just in April 2011, before the May GE, our nation-building constructive media praised him as an example of meritocracy at work. Son of a Barisan Socialist MP (and no friend of one LKY), he was a scholar* who rose to a senior civil service post**, then became a senior NTUC leader, and then a PAP MP candidate. It was whispered that he was Zorro Lim’s anointed successor as NTUC chief; and was tipped by ST as a future candidate for ministerial office. He did became the NTUC’s Deputy Secretary-General in June 2011.

But by then his slave worker drawn chariot had gotten stuck in the mud . He was a member of George Yeo’s losing Aljunied GRC team. Worse was to follow in 2012: the wheels came off his chariot of gold and ivory and he was thrown-off, and cast into the darkness and mud and became a person that the constructive, nation-building media knew not.

Earlier this year, SMRT’s S’porean drivers made known publicly their unhappiness over pay proposals that had his endorsement as Executive Secretary of NTWU (Nation Transport Workers’ Union). As he was also a non-executive director of SMRT, if he were an investment banker, a US judge would have rebuked and censured him for his multiple, conflicting roles.

Then he resigned, effective last month, from NTUC to “join the private sector”.

In perhaps a farewell, good-riddance gesture, FT PRC workers went on strike (illegally) and we learnt:

– they lived in sub-standard accommodation (SMRT admitted this);

– unlike most SBS FT PRC drivers, most of SMRT’s PRC drivers were not union members; and

– Ministry of Manpower reprimanded SMRT for its HR practices.

All this reflects badly on Ong: NTUC’s Deputy Secretary-General,  Executive-Secretary of NTWU and SMRT non-executive director. And on the system that allowed him to rise to the top. After all his ex-boss said the following reported on Friday, which given Ong’s multiple roles in SMRT, can reasonably be interpreted as criticism of Ong:

In his first comments on the illegal strike, which saw 171 workers protesting over salary increases and living conditions, the Secretary-General of the National Trades Union Congress (NTUC) said the labour dispute “shouldn’t have happened” and “could have been avoided”. [So where was Ong: looking at his monthly CPF statements and being happy?]

NTUC is thus reaching out to SMRT’s management to persuade them “to adopt a more enlightened approach to embrace the union as a partner”, he added. [Hello, NTUC's Deputy Secretary-General was on SMRT's board, so what waz he doing?]

Mr Lim, who was speaking to reporters on the sidelines of the Labour Movement Workplan Seminar, cited the example of SMRT’s rival SBS Transit where nine in 10 of its China bus drivers are union members. Only one in 10 of SMRT’s China bus drivers are union members, according to union sources. [So, why didn't Ong advise SMRT to help unionise these FTs, and if he did, why didn't NTUC push harder ehen SMRT refused?]

SBS Transit’s management “recognised the constructive role of the union”, while union leaders “played the role of looking after the interests of the drivers”, said Mr Lim.

“And as a result … they work very closely as one team, it’s a win-win outcome. In terms of how workers are being treated and respected, how management are responsive, how they work together, I think it’s a kind of model that we ought to see more and more in Singapore.” (Today)

Apparently, Ong is supposed to join his father-in-law’s property development business: but with this revelations, it should come as no surprise if his in-law’s family has reservations about him: he might mismanage and upset the workers. Property development companies are fragile because of their leverage: they can’t afford executives who can’t execute.

And if anyone is wondering about the origins and meaning of the term “feet of clay”:

Thou, O king, sawest, and behold a great image. This great image, whose brightness was excellent, stood before thee; and the form thereof was terrible.

This image’s head was of fine gold, his breast and his arms of silver, his belly and his thighs of brass,

His legs of iron, his feet part of iron and part of clay. (Daniel 2:31-33)

And whereas thou sawest the feet and toes, part of potters’ clay, and part of iron, the kingdom shall be divided; but there shall be in it of the strength of the iron, forasmuch as thou sawest the iron mixed with miry clay.

And as the toes of the feet were part of iron, and part of clay, so the kingdom shall be partly strong, and partly broken.

And whereas thou sawest iron mixed with miry clay, they shall mingle themselves with the seed of men: but they shall not cleave one to another, even as iron is not mixed with clay. (Daniel 2:41-43)

…………………….

*From 1993 to 1999, he was in the then Ministry of Communications, where he helped develop the Land Transport White Paper and was part of the team which established Singapore’s Land Transport Authority. Taz right, he was there at the beginning of the great SMRT cock-up.

**He was the Principal Private Secretary to one Lee Hsien Loong, then became the CEO of the Singapore Workforce Development Agency.

SMRT did not brief FT drivers on labour law?

In Infrastructure on 07/12/2012 at 5:17 am

I’m glad that the four FT PRC drivers that are facing charges for instigating an illegal strike are going to get help from some civic-minded lawyers.

Following the guilty plea by one driver who it seems had no lawyer to advise him, I was dismayed.

I had heard via Secret Squirrel and Morocco Mole that the PRC FT drivers had never ever been briefed on the labour law here: particularly that there was a procedure to be followed before striking. And that SMRT has no documentary evidence that it ever briefed its FT drivers.

So when I read that one driver had pleaded guilty, I tot it was unlikely that these issues,  assuming they were true, or even probable would be raised in public by the drivers.

Now that the remaining four charged drivers have legal advice, if these allegations are probable, they would be raised, in mitigation.

Ignorance of the law is no excuse for breaking the law. But ignorance of the law particularly when it is in a foreign language should be taken into consideration when passing sentence: especially if the employer did not brief its FT employees about the legal process involved in taking industrial action.

As to whether SMRT could have been so dysfunctional as not to brief its FT drivers on labour law, fact is that its HR department is pretty dysfunctional.  “MOM [Ministry of Manpower"] said it has reiterated to SMRT that labour and contractual grievances raised by the workers should be a priority and addressed quickly.” And after all, SMRT only introduced the following after the strike:

– “[T]old its drivers at the sessions that it has set up a 24-hour hotline for drivers to call if they have concerns or grievances”; and

– “They have also appointed liaison officers who can speak Mandarin to deal directly with the drivers, said SMRT.”

(CNA report)

Avoid the stock especially as SMRT’s focus on profit is one of the many factors why SMRT has been facing problems, according to its CEO Desmond Kuek. If the CEO talks like this, you can be pretty sure good dividend payouts are not one of his KPIs.

SMRT: Better not take the bus

In Infrastructure on 30/11/2012 at 5:16 am

(If you are short of time, juz read the last two paragraphs on why taking SMRT buses may be dangerous, otherwise read on.)

TRE reprinted this and Neutral responded as follows:

To be fair, “ex-SAF chief and scholar” was only in charge recently and so not really his problem. More like it’s “Miss colour hair” legacy.

 However, it is interesting to see how he handle this situation and if he applies a military approach, these “strikers” can jolly well go home to PRC for christmas.

I disagree.

Ever since the illegal strike began, SMRT has goofed in its handling of it:

– Came out to say initially 102 didn’t turn up: later said 171. If it got it wrong by 10%, fair enough, but it got it wrong by 67%. If it didn’t know how many drivers didn’t turn for work, it means it didn’t know how many drivers extra it would need. If a transport company can’t keep track of attendance, there is something wrong with its management info systems.

– But maybe it wasn’t the fault of the mgt info system but of the internal communications system?

– Then there was SMRT saying that striking workers were sacked; and then saying more had returned to work the next day. If they were sacked, how can return to work?

– As the law is very clear on what constitutes a strike (minister’s comments), management did not take decisive action in calling it an “illegal strike” until after the minister said so, it seems. This did the constructive, nation-building no favours, forcing it into some contortions to explain the initial non-use of the word “strike”. The media will not thank the management for the public ridicule it got.

And

– SMRT has admitted that “swifter actions could have been taken to improve dormitory conditions”. It should have admitted it could have communicated better with the PRC workers. It said on Wednesday, “the additional pay adjustment of S$25 a month for drivers from China was finalised last week and that it is in the process of communicating this to the drivers.” (CNA). Couldn’t they have told the drivers, before they saw their pay slips?

– The dormitory conditions should not have been so bad. SMRT is a TLC and GLC, not any SME.

– SMRT should have encouraged the FT PRCs to join NTUC. SBS did this. If they were part of Zorro’s gang, maybe things may not have reached this point. As Siow Kum Hong wrote on his FB page, “[A]ctually, i think people go on strike only if they feel disenfranchised and after they think they’ve exhausted other options.”

– As the strike took place when the CEO was away on overseas leave, it showed a lack of foreknowledge of worker unhappiness. Or worse: SMRT knew but CEO couldn’t be bothered to change his vacation plans.

These failings reflect badly on the ex-general, ex-SAF chief and scholar. And shouldn’t he be on the first plane back? After all, first illegal strike in Singapore since 1980 and in a TLC. The CEO was an ex-SAF chief and then senior servant: is this boh chap attitude a reflection of the ethos of public service?Thank God, there was no military or national security crisis during his stint as SAF chief.

Avoid the stock. It’s a dog that has fleas on the dog’s fleas.

And what happens if one of the FT drivers is so frustrated that he turns suicidal when driving a bus full of commuters. Or if he runs amok? Has the ex-colonel and scholar in charge of bus operations tot about the possibility that putting unhappy drivers on the road is endangering S’poreans and FTs. Imagine the damage that pictures of passengers being burnt alive will do to S’pore’s reputation as employers’ paradise?

Better give SMRT bus services a miss if you can. And if you have to take a SMRT bus, better make your will first, and check your insurance cover. Better safe than sorry?

Better visit the Pandas quickly

In Humour on 29/11/2012 at 9:38 am

It was reported they made their first public appearance yesterday. Hurry to see them.

They might decide to stay inside their apartment to show sympathy with their comrades in SMRT, especially those helping the police with their investigations.

Wonder what will happen if they offer to share their apartment with their comrades at SMRT. They are all from communist China and I’m sure the pandas are Communist Party members.

“For they have sown the wind, and they shall reap the whirlwind”

In Economy, Infrastructure, Political economy, Political governance on 27/11/2012 at 6:01 am

Well, well. So 102 FT drivers recruited from China (5% of all SMRT’s drivers) refused to work yesterday, disrupting SMRT bus services. They were not happy about their pay. Happily for commuters using the affected bus services, they agreed to return to work while talks continue.

Whither the FT policy, and LKY’s pride in FTs? Striking was a no-no for workers (except, as I recounted yesterday, when the govt had another agenda). S’porean sheep workers did not strike partly because they were afraid of retribution. Now FTs have led the way and have so far got away with it. They might even get more money. If they do, will locals realise that they too can get away with striking? If immigrants whom LKY respect can strike, why can’t they?

And if S’poreans start striking, will the MNCs move on?

Something for the cabinet, PM and his dad to ponder.

“For they have sown the wind, and they shall reap the whirlwind: it hath no stalk: the bud shall yield no meal: if so be it yield, the strangers shall swallow it up.”

As for SMRT, time to forget about the stock. Management is still dysfunctional, despite having a ex-SAF chief and scholar in charge. Err might even turn into another NOL, where as I have recounted another ex-SAF chief and scholar has run it aground (Search “NOL”  on this site).

SMRT is in the biz of transporting people

In Infrastructure on 16/11/2012 at 6:31 am

TRE republished this and improved on it by adding part of  the newspaper report that annoyed me.

Here are some great comments posted on TRE about the “unprecedented offer”

TheFortyPercent:

The SMRT’s attitude is typical of the legacy left behind by LKY. If SMRT makes a generous compensation, people will throw themselves on to the MRT rails. If we have too generous welfare benefits, people will laze around and not work. If we have good health benefits, people will fall sick, get cancer and not take care of their health. If we don’t pay our civil servants and ministers the highest salaries, they become corrupt. If we don’t have the ISA, people will become militant. If we don’t have a meritocratic law of the jungle system, every Singaporean will become lazy and indolent. If we don’t bring the thousands and thousands of foreigners, Singapore will collapse and your mothers, wives and sisters will become maids. And the list goes on….. It just shows how much confidence LKY and the PAP has in its citizens! No other country in the world in all history has its leaders, as Singapore has, condemned, spoken derisively and rubbished its own citizens. This is the wonderful legacy that LKY has bequeathed to all Singaporeans! His money of course goes to his family and the ten generations of descendants after him.

One Eye Dragon In Your Pants:

Wow, so that’s what SMRT thinks of us. Money grubbing opportunists who would do anything (even getting our limbs amputated!) to get some compensation. Yeah, in their eyes, we are all lesser mortals who deserve nothing. Have they looked at themselves in the mirror lately? If only public transportation isn’t monopolized by SMRT & SBS, I would outright boycott their services.

Truth:

It is shameful that SMRT has such bad social grace to say such words of the public , implying the young Thai girl has a motive to lose her legs to get some money. Are we in some foreign lands where people sell their body organs to get some money ? Then why the need to say such unkind words of your commuters, to the effect that they would intrude on the SMRT tracks and implying try some antics to get some donation.

Lousy public relation, presenting a inhumane image of SMRT. These words are really mean and uncalled for.

Thought those infamous word ” opportunity to make money ” sent to the taxis after the breakdown of the trains last December was bad enough, and now these words. The SMRT never learn, or with a new PR people, has still not got its acts together again.

By the way, why is the PaaPa government making the common folks pay for upgrading and repairs bill $1.1 billion for the SMRT ? The Board of directors( past since 2002 )each receiving $200,000 annually and the chairman $500,000 should contribute their fees to the repair bills if they have some conscience. They failed in their duties as directors, and yet keep this money for private enjoyment . Shame on them, especially on Mr Chew Choon Seng, now chairman of SGX, who was the chairman of the board in 2002 that appointed a wrong unsuitable person to be CEO. They got away scot free, enjoying their director fees privately, but now the taxpayers have to bear with the cost of the repair , through no fault of theirs.

Today had reported that the ang moh FT I tot had joined SMRT had still not joined, and is unlikely to do so: Smart “Talent”. When you have a PR person, unapologetically, saying that $15,000 was an “unprecedented” offer to a girl who lost her legs; and that non-payment policy is to deter people from deliberately losing their limbs or lives  to get money from SMRT, it shows the kind of culture ( “choose not to board crowded trains” and “trains can be packed more” and “opportunity to make money” and “never ever damage SMRT property even if you are suffocating in a train that has stopped, and there is no electricity and you are left in the dark”) he would have to defend about if he signed on. Maybe the previous PR boss, an ex-army colonel, should reapply for his job?

He fits the culture to a “T”, blaming the bad English of the staff for them not communicating with the public. He was the person who also said that SMRT should never ever be damaged. Wonder why did he “move on” if he fitted the culture to a “T”. Goh Chee Kong approved comments like this.

Finally, we get to the title of this post:  SMRT is repositioning itself as an engineering company. I’ve commented on why this may be a bad idea: engineering companies tend to gold plate operations.

SMRT should think of itself as a “Mass Rapid Transit” biz: moving crowds of people quickly, in reasonable comfort and efficiently at low cost. Be like AirAsia, EasyJet or Ryanair, the best low cost airlines: decent customer service at lowish prices. And handicapped and elderly people: take a taxi if you are not happy with the service. Don’t bitch too much. Ryanair tells them in no uncertain terms, not to use it. It tells them there are alternatives.

 

SMRT: $15,000 not enough

In Infrastructure on 07/11/2012 at 7:26 am

Talk of bad PR.

When I read that the Thai gal sued SMRT, I didn’t think much of her case. I tot that she should have accepted reasonable compensation and moved on.

But when I read that SMRT says that its $15,000 offer was “unprecedented”, I tot what a dumb, mean company.

I don’t know waz a fair amount would be taking into account her injuries and that it isn’t SMRT’s fault. But $15,000 is not it. Its legal costs would easily exceed $100,000.

I had been looking to buy shares in SMRT, but I’ll give it a miss for the time being. Want to see if mgt changes are working.

Anyway, hopefully the FT brought in to replace an ex-SAF officer will do something to change SMRT’s bad record in public communications. The SAF officer said once “Better you die, than damage SMRT property”.  Ya I exaggerate, but that was the message he gave when a commuter smashed a glass panel to let air into a train stuck in a tunnel.

Circle Line: the unasked questions

In Infrastructure, Media, Political governance on 28/10/2012 at 6:06 pm

I’m writing this on Sunday evening.

On Saturday morning, I read that replacing the Circle Line ‘s power cables would take 18 months, beginning from January next year.

SMRT said the areas between Dhoby Ghaut and Dakota Stations are more problematic, compared with other parts of the network, as the cables sit in an area that is prone to water seepage from the ground.

SMRT’s executive vice president for trains, Khoo Hean Siang, said there are plans to replace all the cables.

He added: “We want to change out to a higher grade cable that can submerge, (be) more water resistant to make sure … the system will last for 20 to 30 years.” CNA report.

But neither, MediaCorp nor SPH reporters asked:

–  “The North-South Line only started giving serious problems last year. It was opened in 1987. Why is the Circle Line giving problems so soon?”

– “Given the newness of the line, first opened in 2009, and with the latest stations connected just last year, how come the electric cables need replacing so fast?”

– “Why were these cables used?”

– ” As the total cost was nearly S$10bn, not peanuts, by any measure, why were these cables chosen?

– “What other problems could possibly happen, given the cables gave problems much earlier than anticpated?”

– What is the cost of replacing the cables?

– Who is bearing the cost of replacing the cables? SMRT? Or the govt? If SMRT, will dividends be affected? Or will fares have to rise?

And neither did they ask these questions on Sunday. and my Secret Squirrels and Morocco Moles in both these constructive, nation-building media organisations, tell me that tonite’s programmes and tomorrow’s editions will not ask these questions.

These are the questions that the media should be asking. I’m sure PAP MPs  and Lina Chiam will be asking some of these question in parliament.  And I’m sure netizens are already asking these questions. But I’m sure the WP MPs will be silent. Too busy looking at their bank statements to see if the 30 pieces of silver ++ have been paid into their accounts? Taz what my disillusioned Morocco Mole in WP is wondering.

At the very least, S’poreans must be told why the decision to purchase a cable, now known to be sub standard, was made or allowed to be made? Was it an “honest mistake” by someone or an entire organisation, or an organisational failure, or was there corruption?

My very simplistic answer is that in the 1980s when the first lines were being built, one LKY was PM. No-one wanted to explain to him why the trains would not be running on time. The Circle Line was largely built when the PM was one Goh Chok Tong, and his DPM was one Lee Hsien Loong, today’s PM, his chosen successors. Whatever history may say about LKY, the train lines built when he was PM lasted over 20 years, before giving serious problems. Under his chosen successors, the Circle Line didn’t even last fault-free for five years.

Sometimes change is not for the better, even ifthuggish methods of management have been replaced by more civilised, possibly less effective, methods.  

And while there is no longer fear in the air the media breathes, the mental “knucklebusters” still remain in the minds of the media.

How SMRT can spend more on maintenance while cont’d paying gd dividends

In Infrastructure on 13/08/2012 at 6:55 pm

Find sponsors for MRT stations Dubai style.

The station at Changi Int’l Airport can be renamed after Changi Airport, or SIA or any airline wanting publicity. Raffles City can be renamed after Robinsons or Westin. Raffles Place can be named after a bank sponsor while Temasek can sponsor Dhoby Gaut.

While new CEO as an ex-SAF chief and senior civil servant (also a scholar) should ensure that the trains run on time (in the early 20th century in the US, retired generals were in demand to run railwa s because the army like the railways were complex organisations), he might not be gd for profits. As I explained here, SMRT is now seeing itself as an engineering co, not a transport co, but problem is that engineers tend to gold-plate their operations.

Is PAPpie Ong Ye Kung behaving like a bad Goldie investment banker?

In Corporate governance on 09/08/2012 at 6:16 am

So SMRT bus drivers have given a tight slap to their union chief* and  NTUC’s deputy secretary-general, who is also a board member of SMRT Corporation, Ong Ye Kung. He also happens to be part of the PAP GRC team that lost Aljunied. He had told them that working six days a week is a fairly standard arrangement, and insisted that with the increase in basic pay, their salaries will be higher, compared with what they had earned in a five-day work week plus an additional day with overtime pay**.

They have complained to his NTUC boss, a cabinet minister.

He is lucky he is not in the US, and not an investment banker. A few months ago, a judge’s ruling made Goldman Sachs potentially liable for some pretty serious damages if shareholders of a company wanted to sue it (Some are). Anyway, the ruling was another hole below the hull in Goldmans fast sinking reputation.

Goldman was on every conceivable side of a deal involving the sale of El Paso. As a result, El Paso may have unwittingly sold itself far too cheaply. Goldman was inherently conflicted because it represented El Paso for part of the time in the sale negotiations with Kinder Morgan, the buyer, and advised El Paso on a possible spinoff of its pipeline business. But Goldman’s private equity arm also owns 19.1% of Kinder Morgan and has two appointees on Kinder Morgan’s board. For more details see links below.

Sounds a bit like Ong’s position. He is everywhere in the proposed pay deal: union leader of the drivers, negotiating for drivers, leader of the constructive, nation-building NTUC, SMRT director, and who knows where else.

No wonder, the drivers don’t trust his judgment.

And then there is a big question mark on his character. His dad, now deceased, was a fierce opponent of the PAP. So fierce, that he was detained under ISA. Yet he joined the NTUC, a training ground for Sith Lords. And became a PAPpie after dad died, standing in Aljunied GRC and helped create history by being part of George Yeo’s losing team: first PAP, and combine ministerial and NTUC team (two cabinet ministers and one jnr minister and two NTUC leaders) to lose a GRC.

Links mentioned above

http://dealbook.nytimes.com/2012/03/01/the-losers-in-the-el-paso-corp-opinion/?nl=business&emc=dlbkpma1

http://dealbook.nytimes.com/2012/03/05/advising-deal-goldman-sachs-had-all-angles-for-a-payday/?nl=business&emc=edit_dlbkam_20120306

————————————

*The executive secretary of the National Transport Workers’ Union.

**To be fair to him, it sounds like a gd deal. But I defer to the judgement of those affected. I’m no elitist even though I’m from RI. I even once won a prize for academic excellence.

Reason WP quietly ditched its public tpt nationalisation call?

In Infrastructure, Political governance on 09/07/2012 at 7:01 am

(“Trying to serve residents better, WP ditches manifesto call nationalise public tpt?”)

My WP “Morocco Mole”* (the sidekick of  “Secret Squirrel” in the carton series: bit like Yaw to Low) tells me that at July’s parly seating, GG will again keep quiet on the above issue in the debate after the ministerial statement on the major disruption in the MRT system. Tells me no other WP MP will raise the issue of public tpt nationalisation, as this is GG’s responsibility.

He asked, “Why so cock, when the Commission of Inquiry’s findings  that SMRT was skimping on maintenance can be used to support WP’s election manifesto call to nationalise public transport? Also shows WP can think better than PAP.”

I referred him to this ST report, where it was reported that MPs are lobbying LTA  for better bus services in their wards: all because the $1.1 bn subsidy.

I told him since WP has appointed Ah Huat (remember him?) to co-ordinate its efforts for more buses to serve Hougang and Aljunied, it would be most awkward for him (and WP) to beg LTA, and SMRT and SBS to improve services in WP areas if the WP is publicly proposing to destroy their staffs’ rice bowls. It would have no leg to stand on.

His response, “Tan kuku. Even if Sylvia, Glenda and Angela (remember her?) perform [expletive deleted] on the LTA, SBS and SMRT male managers, and Show Mao [expletive deleted] the female managers, think that they will improve services in WP areas? Why WP so cock?” 

He has a point. SIGH (Victor Hugo: “A traitor always pays for his betrayal in the end.”)

Related post: http://atans1.wordpress.com/2012/05/28/hougang-only-up-to-a-point-lucky/

—-

*Moley is a WP cadre but not on the Central Executive Council,. He is ex-Barisan. He early last week told me that the WP had tabled only one question abt public transport (abt the release of the COI report). He is right. Which makes WP’s silence on this issue more deafening. Look at the topics raised: what the public wants raised for the most.

Demonising cabbies again?

In Uncategorized on 08/06/2012 at 5:35 am

(Or “How to get more taxis on the road, increasing rentals, and still screw the consumer”)

Last Saturday, MediaCorp’s freesheet carried an article that screamed

Taxis could become harder to flag down

More may obtain a taxi licence to rent cabs for personal use instead of plying the roads

It went on: more people could possibly be getting taxi licences for the wrong reasons – as suggested by Transport Minister Lui Tuck Yew in a press interview … Noting how, with the exception of those owned by ComfortDelGro, taxis are hired out mostly to cabbies who drive a single shift per day, Mr Lui said the authorities “need to be even more vigilant about this … because now driving a taxi can, with high COE prices, become a substitute for owning a car”.

Right, it’s the fault of cabbies gaming the system that we can’t get a cab. Not the fault of ComfortDelgro, the govt, or SMRT.

In mid April, there was a ST report that taxi drivers’ take-home income have gone up by as much as 30% since the increase in taxi fares at the end of last year. “ComfortDelGro, the biggest operator here with about 15,600 taxis, said average net income per cab per day has risen by 12 per cent to $210.93 … up from $188.69 in November, excludes costs drivers have to bear, such as rental and diesel.”

In the run-up to the fare increase late last year, our nation-building, constructive media were full of stories of the plight of cabbies. And when fares were increased, there were stories of drops in income as people stopped taking cabs. Poor cabbies. The media also reported extensively that the fleet owners were NOT increasing their taxi rentals. The benefits of the  increase were all going to the cabbies.

So I was surprised (in February or early March) to read in the same said media that S’pore had plenty of  taxis (about 27,000 of them) but that taxis were under-utilised because some work on one shift with one operator per taxi who “once they earn enough would call it a day”.

In April, we were told that they are doing well: to to 30% increase in take-home pay. So will there be shortages again as more of those taxis with one operator are AWOL because the operators call it a day after they earn enough? Now we are again reminded that many cabs are only operated by one person a day, and worse: that increasingly cabbies are gaming the system by using the taxi as a car, not as a cab. Juz earn enough to pay rental, then use taxi as car, for what we are not told. Transport gds? Visit clients? Or rent to senior members of Home Team or other scholars to have sex in in return for favours?

A shortage that will be solved when the fleet owners increase their charges so that the cabbies have to work longer hours again?

In other words, are we “being conditioned” for operating costs (not fares) for cabbies to go up to increase the supply of available taxis.

Then we will read stories in the media that taxi drivers are suffering, and that fares have to rise. And we shouldn’t complain if we are compassionate.

The cycle of spin goes on. Bit like the cycle of life.

Instead of inceasing rentals to increase supply, why not insist that each taxi must have mutiple operators working in shifts? Incentives, disincentives could be introduced to force cabbies into sharing? Afraid of too many cabs on the road, forcing down rentals because cabbies are leaving the industry?

.

SMRT: OCBC further justifies its “Hold” call

In Infrastructure on 20/05/2012 at 5:16 am

Remember that with the exception of JP Morgan and OCBC, all other brokers are calling a “sell” on SMRT. Only Morgan And OCBC were SMRT bulls.

Share price has held steady since results

As for SMRT’s share price, it has held steady despite initial selling pressure following its weak FY12 results, and has managed to outperform the FTSE STI Index over the past two and a half weeks (-0.9% vs. -5.3%). While the COI continues its public hearings, we deem the possibility of further sharp sell-offs to be remote as SMRT services and its operational cash flows remain in demand and resilient.

Maintain HOLD

We reiterate our belief that SMRT will not have difficulty addressing its higher capital outlay requirements given its existing net cash position and available MTN programme, and leave our conservative 60% PATMI dividend payout ratio estimates unchanged. Maintain HOLD with a fair value estimate of S$1.71.

http://yieldstocks.reitdata.com/2012/05/17/smrt-ocbc-3/

SMRT: “Cowboys” were right

In Corporate governance, Infrastructure on 14/05/2012 at 8:52 am

Since the trains started breaking down towards the end of last yr, bloggers and posters (not I) have been attacking SMRT for putting profits before safety, and disregarding the engineers’ advice (though without having a clue abt the said advice). Yacoob’s exemplar for the new media, the constructive, nation-building media were deafening in their silence on this national issue. I was silent because I was trying to figure out if I shld go buy some SMRT shares.

Well, based on the comments by the chairman, Koh Yong Gua, reported by ST and ST’s headline on an inside page, the inhabitants of cowboy towns were correct. (Explain that Yacoob and DPM Teo.)

“SMRT to refocus on its engineers” read the headline. This implied that SMRT had lost its focus on engineers somewhere along the line, assuming it once had such a focus.

Mr Koh said that “SMRT will be repositioned an engineering company”, begging the question “What was its earlier positioning?”. Retailer, property developer, financial engineer, or cash cow for Temasek? Since SMRT was listed in 2000, Temasek has received $694.3m in dividends (I’ve including the dividend declared recently).

The promotion of Mr Khoo Hean Siang in March 2011 to COO was meant to show the importance of engineers, he said. The previous COO who was “removed” was not a technical person. Wonder what was he? Ex-SAF officer or financial man? With the CEO a retailer, it surprises me that until 2011, the COO was not a technical man. And that board meetings did not include a very senior engineer in attendance.

Actually, I think Mr Koh still hasn’t got it. SMRT is not an engineering company. It is a company whose main business is moving large numbers of people around S’pore safely, and in reasonable comfort (most of the time). By focusing on engineers and positioning SMRT as an engineering company, he could be laying the seeds for a serious problem somewhere along the track. Investors in the West have found that companies dominated by engineers tend to goldplate processes and systems. Siemens, Rolls-Royce, Westinghouse, Boeing, Airbus and even GE, had to be run by non-engineers before shareholders benefitted.  

Commuters may say so what? So long as it is safer and doesn’t breakdown, power to the engineers. The problem is that goldplating is expensive, and eventually someone has to pay. This is likely to be the commuter (via fare increases) or his avatar or alter ego the taxpayer.

I was planning to buy into a rights issue when one is annced, as I expect. But given the positioning as an “engineering company” and its “refocus on its engineers”, I think I’ll give the stock a miss for the time being. But never ever bet against Temasek when it comes to a local company.

Related post:

http://atans1.wordpress.com/2012/05/06/smrt-quiet-re-nationalisation/

SMRT mgt failures: What does it say abt SAF?

In Infrastructure on 11/05/2012 at 10:19 am

“The experts questioned having the bus bridging services ply a route mirroring the entire train line as this may not be the most effective way to move people. They suggested that the bus bridging services should ferry commuters to one to three stations, or to the next working station.”

Huh? Having been lucky enough not to kanna caught in one of these disruptions (my 87-yr old mum on her only second MRT outing was at a station when a disruption occured), I’m surprised to learn that this wasn’t done or that it isn’t now SOP?

Given that it is a well-known fact, I believe, that retired SAF officers are given senior jobs at SMRT (presumably because they have the experience of managing large and complex organisations), I’m surprised that foreign experts recommended the following “fairly common sense and not rocket science” command and control procedures:

http://www.todayonline.com/Singapore/EDC120510-0000079/Foreign-experts-give-tips-at-SMRT-inquiry

http://www.channelnewsasia.com/stories/singaporelocalnews/view/1200227/1/.html

We need genuine Talents to help us run our public transport systems, not ex-SAF officers, M’sian PRs or PRC bus drivers that we have been getting. And no “ang moh tua kee” attitude when getting Talents please. Hongkies, Japs, Taiwanese and Koreans who speak Inglish should be considered. No PRCs because China’s MRT systems are very new.

As to our defence, are we spending money foolishly on hardware, when what we need are a few good men? The government should be worried. It’s not us “lesser” citizens are at risk. It’s the FTs and rich S’poreans who need protection. An Indonesian pirate chief after reading of SMRT’s failures despite employing retired SAF colonels, may be tempted to raid Sentosa Cove, plunder it and kidnap people.

SMRT: Quiet re-nationalisation

In Infrastructure, Political governance, Temasek on 06/05/2012 at 7:34 pm

(Or “SMRT: Has the government and WP switched positions on the quiet)

On Friday, SMRT reversed its recent losses and was up 0.9% to 1.65. It was at 1.81 juz on 24 April.

Interestingly among the slew of brokers’ reports calling it a “sell”, “nationalisation” seems to be a dirty word, never raised except by two honourable brokers. Only Citigroup was willing to hint at re-nationalisation, “We’d even dare conjecture a Government-led end game, while only Kim Eng suggested that “selective nationalisation” is already taking shape, “A hybrid model, where the Government comes in to inject money, is perhaps the best model possible under the circumstances … like selective nationalisation where the Government pumps in money in certain areas … being done already – take for example, the Government co-paying for the buses to help operators expand the fleet.”

UBS said SMRT is highly likely to move to a new rail-network financing framework where it would pay the government for an operating lease instead of owning train assets,

And only Citigroup is willing to hint at, “We sense more drastic actions are needed, perhaps raising capital to shore up finances.” In simple English, it says a rights issue is possible. Everyone else was silent on this pink elephant in the room.

I think a rights issue is very highly probable.

Let’s go thru some numbers. At Friday’s close, the mkt cap of SMRT was $2.49bn., of which $1.35bn can be attributed to Temasek (It owns 54.3% of SMRT).

Now SMRT has plans to spend $900m over the next eight years and it wants LTA (i.e. the taxpayer) to share the cost. What if the government tells SMRT that it shld fund two-thirds of the cost because the Commission of Inquiry finds that SMRT was not maintaining the tracks properly. (I’m assuming the COI makes this finding based on the way the inquiry is going).

To fund this $600m, SMRT’s directors call for a deeply discounted rights issue to raise $600m (about 24.1% of SMRT’s mkt cap as of Friday). Add to that they say that dividends will have to be cut drastically*, and that Temasek has agreed to underwrite any shares that minority shareholders refuse to take up. Temasek will say that its decision to support the rights issue is a “commercial decision” of a long-term shareholder. Right, and pigs can fly, a leopard can change its spots, KennethJ and TJS can stop boasting, Chiam can renew the SPP’s leadership, and Yaacob can tame the internet tsunami by building a CoC flood wall.

In such a scenario, Temasek could end up with 75-80% of SMRT, as many minority shareholders decline to take up their shares because of the reduced dividend payments.

Ain’t this partial re-nationalisation? And Temasek can have its cake and eat it too, depending on whether the other shareholders subscribe to the rights. Since SMRT was listed in 2000, Temasek has received $694.3m in dividends (I’m including the dividend declared recently). A $600m rights issue and assuming it has to take up all the rights shares still leaves Temasek $94.3m ahead. Might as well make it $700m rights call then, shall we?

Ain’t nationalisation of the public tpt system in the WP’s manifesto (I’ve blogged on this and that the transport minister parrots his predecessors’ defence of the rojak “for profits” system). Lucky Tan has this video of my friend Eric Tan then a WP member (and treasurer) talking abt nationalisation at the last GE. So the silence of the WP which I’ve raised before) is strange, and in the longer term worrying (No can trust its manifesto promises, why shld voters trust the WP?).

So I hope in the May session of parly, GG for one can raise the issue of nationalisation and put the government on the defensive. Why GG? In July last yr, he wrote this on nationalising the public tpt system. This was after Eric Tan had left WP in a huff, so the call for nationalisation of the public tpt system did not end when Eric Tan left.

If the WP remains silent on nationalisation of the public tpt system, it would remind me of a Sherlock Holmes mystery:

Detective: “Is there any other point to which you would wish to draw my attention?”

Holmes: “To the curious incident of the dog in the night-time.”

Gregory: “The dog did nothing in the night-time.”

Holmes: “That was the curious incident.”

BTW, OCBC (a ex-bull on SMRT) is still relatively bullish. It downgraded SMRT to hold from “buy” and lowered its target price to S$1.71 from S$2.04, citing weaker-than-expected earnings for 2012 because it estimated that SMRT’s capital expenditure in 2013 will rise to S$500 million due to higher expenses needed for upgrading its assets.

CIMB cut its target price from $1.68 to $1.50, suggesting a switch to ComfortDelGro to maintain an exposure to the land transport sector. Deutsche cut its target price to $1.61 from $1.75 while J P Morgan downgraded the stock from “overweight” to “neutral” with a target price of $1.60. Phillips cut its target price to $1.33, maintaining its “sell” call. I suspect Phillips is right. A rights issue will be priced at around the $1.33 level.

I’d buy some shares then. Never bet against Temasek when it comes to a local counter.

——

*”Some [analysts] expect SMRT to cut its dividend payout from 70-80 per cent of profits historically to at least 60 per cent.” (BT). What if this was reduced to 25%?

SMRT: Dividend of 5.7 cents but price down another 2 cents

In Infrastructure on 02/05/2012 at 7:22 pm

From the day last week when SMRT annced its eight-year $900m programme to upgrade many infrastructural and systems components on the North-South and East-West lines would exceed what it had spent on repairs and maintenance in the past 10 years, and

– no details on how the cost will be co-shared with the Land Transport Authority (to be negotiated); and

– no details on many parts of the upgrading programme,

till Monday, its share price fell 7.2% from 1.81 to 1.68. It then annced its results (not gd as expected) and today closed at 1.66 down another 1.2%. It went as low as 1.63. All this despite paying a dividend of 5.7cents a share or 3.4% of Monday’s close. (Mkt was closed on 1 May.)

Starting to look interesting as a dividend stock with recovery prospects. Time to analyse results in detail.

Mean of me, but I can’t resist reposting OCBC’s note dated 9 April when stock was at 1.74 and OCBC reiterated its “buy” call.  

————–

OCBC report on SMRT dated 9 April 2012

Strong selling pressure as anticipated by more than half of the street failed to materialise with the counter trading tightly range-bound for slightly more than two months.

During this period, SMRT has also kept to a lower profile with the announcement of work completion from its Internal Investigation Team as the only major development.

Ahead of the upcoming earnings release at the end of the month, we continue to stress that SMRT is likely to see an upswing in fuel costs, following the run-up in prices as well as the additional train runs commissioned in the face of higher ridership and public pressure.

Coupled with higher staff costs related to seasonal merit increments and additional headcount to meet service requirements, we are likely to see the weakest quarterly performance for FY2012.

In terms of fallout from the December 2011 service disruptions, we do not expect any incremental costs at this juncture as the more important inquiry by the Committee of Inquiry (COI) has yet to be completed.

While SMRT’s FY2012 results are likely to stay uninspiring, the counter’s attractiveness as a dividend play remains its key selling point. SMRT’s management has maintained and reiterated its commitment to maintain its dividend payout policy.

Although its prospects going forward will be challenging – COI findings, no fare increments – SMRT’s ‘customer’ base is still growing.

Ridership levels continue to grow especially with support from the current trend in COE prices, while rental and advertising yields are naturally competitive given the high foot traffic locations of their stations.

With this backdrop and earnings support and stabilisation in SMRT’s price, we continue to call for an attractive entry point for SMRT.

Maintain ‘buy’ at an unchanged fair value estimate of $2.04.

SMRT: Reality hits shareholders

In Infrastructure on 26/04/2012 at 7:47 pm

SMRT is down another 2% today closing at 1.70 (-o.o35). It was down 4% yesterday (Wednesday) closing at 1.735 (-0.075)

Well with Tuesday’s announcement that SMRT’s eight-year $900m programme to upgrade many infrastructural and systems components on the North-South and East-West lines would exceed what it had spent on repairs and maintenance in the past 10 years, and

– no details on how the cost will be co-shared with the Land Transport Authority (to be negotiated); and

– no details on many parts of the upgrading programme,

the sell-offs were to be expected.

What was surprising was that the stock was trading 1.81 on Tuesday  As I mentioned here last week, I was surprised that the stock had not fallen after the most recent problems on the Circle Line. In fact the stock had gone up since 9 April , when OCBC called a buy at 1.74. This despite the ongoing inquiry had yet to allocate blame, and no announcements (then) of spending plans to maintain and upgrade the system so that it would be fit for purpose.

Mkt in SMRT shares was not efficient.

Seeing the funny side of SMRT’s woes (Part II)

In Infrastructure, Political governance on 19/04/2012 at 7:19 pm

(Part I)

I also had a laugh when despite Second Solicitor-General Lionel Yee pointing out from the start that the inquiry looking into the December 2011 breakdowns “is not an adversarial proceeding but a fact-finding one”, the lawyers for LTA and SMRT put the blame on each other’s client.

(Leading to a Voice to comment, “Since it has been stated upfront that the proceedings are non-adversarial, why is there a need to hire expensive senior counsel, some at the expense of taxpayers? … SMRT Corp and the Land Transport Authority must have competent senior officials who are capable of assisting the COI with the investigations.”)

I can understand SMRT wanting to evade responsibility for commercial reasons. It could be fined heavily, and made to spend more on maintenance, depriving it of revenue to pay management bonuses and shareholder dividends. But should be so be so aggressive trying to pin the blame on SMRT. Scared of showing LTA was less than competent?

LTA’s lawyer Andrew Yeo, from Allen & Gledhill, took issue with the SMRT’s maintenance regime which could be improved, although it was “comprehensive and satisfactory”.

Citing a report by the transport operator’s internal investigation team, Mr Yeo said: “SMRT’s maintenance expenditure and manpower headcount for the maintenance of trains and trackways has not been increasing in recent years, at the same rate as the increase in kilometres travelled per train,” said Mr Yeo.

According to Mr Yeo, SMRT records showed that there has been a reduction in the number of wheel-profiling works between 2009 and last year even though there has been an increase in incidents of wheel defects over the same period. He also said that SMRT’s maintenance budget had not kept pace with the increasing ridership.

SMRT also “could do better” in terms of record-keeping, especially in the tracking of defects. “That would in turn enable any lapses or deficiencies in maintenance work to be easily detected and rectified,” Mr Yeo added.

Mr Yeo’s comments drew a response from SMRT’s lawyer Cavinder Bull. The Senior Counsel from Drew & Napier asked: “Whose duty is it to do what?”

He pointed out that the infrastructure was technically owned by the LTA. Also, any modifications to the infrastructure “must be submitted to the LTA for their review and approval”, Mr Bull said.

Alluding to findings from a team of experts, Mr Bull said that the SMRT has acted with “appropriate due diligence” in terms of its maintenance and engineering regimes.

Mr Bull added that any wheel defects or third rail gauge variation – which may have contributed to the higher vibrations, which in turn may have contributed to the dislodgement of claws – “did not occur due to a lack of maintenance”.

In fact, he said, the SMRT’s maintenance regime has been more stringent than what is recommended by the manufacturers: The various checks on the third rail are done every three or six months, which is more than the yearly inspection which manufacturers recommended.

Mr Bull also stressed that the dislodgement of the multiple claws which led to the breakdowns was caused by “a rare confluence of factors, none of which individually could have resulted in the incidents”.

Reiterating that it was not the SMRT’s intent “to shirk its responsibilities”, Mr Bull said that after discussions with the LTA, SMRT intends to change all the claws to “fifth generation” ones, which are installed on the Circle Line, as well as the Changi Airport and Boon Lay Extensions. Today article

Seeing the funny side of SMRT’s woes (Part I)

In Humour, Infrastructure on 19/04/2012 at 7:10 pm

With

– a foreign wire, AFP, reporting, “Services were disrupted along a new multi-billion-dollar Singapore metro line on Wednesday, the third straight day of rush-hour delays for the city-state’s gleaming train system”; and

– ST

—— pointing out, “No fewer than five disruptions took place within a week since last Friday, with all of them affecting rush-hour commuters”; and

—— “Statistically, this frequency far exceed the average one-per-week disruption that lasted more than 10 minutes between April 2010 and March last year, and the 0.6-per-week average recorded between 2007 to mid-2009″,

I couldn’t help but wonder if OCBC would change its mind on SMRT because on 9 April, OCBC issued a BUY call  on SMRT which was then trading at 1.74. BTW it closed at 1.81 today, so the recent problems have not affected the share price, another laugh there

—————

OCBC report on SMRT dated 9 April 2012

Strong selling pressure as anticipated by more than half of the street failed to materialise with the counter trading tightly range-bound for slightly more than two months.

During this period, SMRT has also kept to a lower profile with the announcement of work completion from its Internal Investigation Team as the only major development.

Ahead of the upcoming earnings release at the end of the month, we continue to stress that SMRT is likely to see an upswing in fuel costs, following the run-up in prices as well as the additional train runs commissioned in the face of higher ridership and public pressure.

Coupled with higher staff costs related to seasonal merit increments and additional headcount to meet service requirements, we are likely to see the weakest quarterly performance for FY2012.

In terms of fallout from the December 2011 service disruptions, we do not expect any incremental costs at this juncture as the more important inquiry by the Committee of Inquiry (COI) has yet to be completed.

While SMRT’s FY2012 results are likely to stay uninspiring, the counter’s attractiveness as a dividend play remains its key selling point. SMRT’s management has maintained and reiterated its commitment to maintain its dividend payout policy.

Although its prospects going forward will be challenging – COI findings, no fare increments – SMRT’s ‘customer’ base is still growing.

Ridership levels continue to grow especially with support from the current trend in COE prices, while rental and advertising yields are naturally competitive given the high foot traffic locations of their stations.

With this backdrop and earnings support and stabilisation in SMRT’s price, we continue to call for an attractive entry point for SMRT.

Maintain ‘buy’ at an unchanged fair value estimate of $2.04.

“Subsidy” is NOT a four letter word

In Financial competency, Political economy, Political governance on 06/03/2012 at 5:33 am

Many bloggers are upset that the govmin is giving S$1.1bn to SMRT and ComfortDelgro to help improve bus services. Seems to them, “subsidy” is a dirty word. Hmm, didn’t they get the idea that subsidies are always bad from the PAP idea, particularly one LKY?

But maybe, the PAP has changed its mind that the word “subsidy” is a dirty word. Reminds me of what Keynes is supposed to have said In response to an accusation of inconsistency: Keynes is often reported to have said “When the facts change, I change my mind — what do you do, sir?”. More to the point, he is reputed to have said: “When circumstances change I change my mind. What do you do?”

Well the facts and circumstances have changed. The PAP’s share of the popular vote is only 60% and its perceived presedential candudate won by just 7000 votes or less than 1%.

I’m not complaining that the PAP is being pragmatic by addressing the hot issue of overcrowded public transport: I take the bus. I’m not one of those who don’t take the bus regularly, has one car per family member, doesn’t pay income tax, and bitches abt this subsidy.

BTW, I don’t own shares in either company, nor in SBS Transit. I never bot as I tot dividends might not be sustainable. Juz look at the share prices in recent years. The yield remains highish because share prices have collapsed i.e. dividend payments have fallen.

But now the 2011 dividend payments for ComfortDelgro and SBS Transist look sustainable.

Anyway, here’s an example of a subsidy. I own shares in HSBC which I’m glad took advantage of the European crisis to get a subsidy from the European Central Bank. Let the BBC’s Robert Preston tell the story,

“HSBC, widely perceived to be the strongest of the UK’s banks and one of the strongest in the world, borrowed €5.6bn from the ECB … The reason it may be controversial that British banks have borrowed so much from the ECB – a bit less than 4% of all the money on offer – is that the interest rate is so low, just 1%. So arguably eurozone taxpayers are subsidising UK financial institutions.

Oh what a tangled web we weave: MRT, ComfortDelgro and the Government

In Infrastructure on 02/03/2012 at 5:58 am

According to the Christian doctrine of the trinity, there is only one God but God is three persons: the Father, the Son ( Jesus Christ) and the Holy Spirit. But each person is God, whole and entire.

Well our public transport system is some sort of trinity: the government*, ComfortDelgro and SMRT. Except while they are legally separate entities, in practice there is a kind of blending. This makes the Christian doctrine of the trinity easy to understand by comparison.

I’ll use the flow of funds between the companies and the government to illustrate an example of S’pore’s unique trinity at work. Using back-of-the envelope calculations and figures in annual reports, since it was listed SMRT (over a decade ago) has paid S$562.79m in dividends to Temasek, and ComfortDelgro has paid the S’pore Labour Foundation (a statutory board affiliated to the NTUC) dividends of  S$150.46m*since 2003 (Comfort and Delgro merged in 2003, and SLF had a stake in Comfort). The amount that ended up with the government was S$713.25m, with SMRT contributing 79%. But ComfortDelgro is likely be the main beneficiary of the S$1.1bn bus plan**, given that, at present, SBS Transit (a listed co 75% owned by ComfortDelgro) provides most of the buses. Taz an example of how messed up things are.

The funds’ flows also show that the government is putting back all the dividends it received from these two companies and then adding 35% more. So it’s wrong to say that the SMRT and ComfortDelgro are getting free lunches. At most the government is subsidising their lunches by 35%.

The government should get credit for ploughing its share of the “loot” (as the proponents of nationalisation would put it and MPs Puthu, PAP, and PritamS, WP, might put it), but it doesn’t. Taz how messed up are.

(Incidentally, one could reasonably argue that the other shareholders — and the minority shareholders of SBS Transit, remember ComfortDelgro owns around 75% – are getting a free lunch while the government returns its share of the dividends. But let’s not get into that today.)

What a mess. Even the government implicitly accepts that the present “rojak” system of organising the public transport here is not something that it would have introduced, if it had been prescient:

– it is is now planning to publicly funding the bus fleets of Comfort Delgro and SMRT with S$1.1bn; and

– in 2009, the then transport minister, a private sector PAP “catch” (“retired’ after the 2011 general election when the WP almost won the GRC he was helming) that joined the government was trying to fix the system while not admitting that the system was broken even then. (Thank Alex Au’s write-up on this for reminding us what that minister said in 2009.)

So it is no surprise that the the WP’s call in its 2011 general election manifesto to nationalise the public transport system**** is getting a lot of support (the nationalisation, not the WP’s call) from netizens. There may be merit in a nationalised public transport system: instead of being run for shareholders who are only interested in profits, and dividends, the system is run for the benefit of commuters. One of these days, I may run through the arguments. But don’t hold your breath. I think the debate is sterile as it all depends on one’s assumptions and definitions.

Sorry, back to the “rojak” system:  in the short-term, there is a problem of overcrowded buses. And this problem needs fixing. Nationalising the system ain’t as easy as passing a law. Shareholders have to be compensated and this requires valuations to be made, and agreed upon, or adjudicated. And it ain’t as though the shareholders are FTs. As mentioned earlier:

– Temasek owns 54% of SMRT; and

– The S’pore Labour Foundation, a statutory board linked to the NTUC, holds 12% of Comfort Delgro. SLF is Delgro’s single largest shareholder.

(Incidentally these stakes especially Temasek’s controlling stake shows how absurd the system is. S’pore has public transport private monopolies that are partially owned and controlled by the government. And the government regulates the fares and the routes. And as mentioned earlier, the government’s share of the dividends are now ploughed back and added to, but not appreciated by the public.)

Meantime, who is to run the system, and fund the fleet expansion? Public has to wait while these issues are sorted out? It’s OK for those critics who don’t use public transport that often, especially those who have one car per family person. But most S’poreans are not that fortunate.

To me, the government spending on the buses is a pragmatic quick fix both for the public and itself. The commuting public (self included when forced to travel during peak periods, admittedly a rare occurrence) gets less annoyed with the government, while the government is seen as publicly responding positively on a matter of public unhappiness.

As to the concern that the system is being fixed to bring more FTs in, let’s reserve judgement on that. Too early to even speculate. To even speculate, shows the level of mistrust that some people have of this government. I’m not one of them.

So while longer term, nationalisisation may be the best way to run a public transport system, it ain’t a short-term fix. The short-term fix is what the government is doing, throw money at the problem.

Critics should focus on whether the fix is the most cost-effective means of solving an immediate problem, not focus on a possible long-term solution. They should be making a case (not juz asking) for ComfortDelgro and SMRT to make massive rights issues to fund bus fleet expansion. Or asking for detailed details on what taxpayers get in return? Or how to ensure that the other shareholders don’t get a free lunch because of the S$1.1bn package.

Plenty of things to do to keep the government on its toes.

BTW, the full quote in the title is:

Oh what a tangled web we weave,
When first we practise to deceive!

——-

*I’ve simplified: there is a universe within the government — including the Land Transport Authority, the Ministry of Transport, the committee that fixes train and bus fares, the S’pore Labour Foundation, the Minister of Finance (owner of Temasek), the Singapore Civil Defence Force and the police force.

**Dodgy this calculation as I’ve used a dodgy, lazy assumption, but near enough for all but CFAers, or investment analysts, or myself when analysing an investment)

***The government has allocated S$1.1bn to the purchase of 800 new buses, 550 of which will be paid for by the government (that is, through public funds), with the remaining 250 paid for by the PTOs. The S$1.1bn is also to fund running costs over the next 10 years. More on the use of the money, and an assurance that the operators will not benefit because it is a subsidy for us commuters. [Last sentence is an update on @ March 2012 at 9.00am]

****Unless the WP has quietly ditched this too like its benchmarking of ministers’ pay to the poor. I am not being mean or nasty. In January 2012, Gerald Giam had to be reminded in a private conversation where I was present that nationalisation was in the party manifesto for the 2011 general election. GG seems to have difficulty remembering things. He had some problems in parliament during the ministers’ salaries debate.

SMRT: Stating the obvious

In Infrastructure on 01/02/2012 at 11:20 am

At SMRT’s 3Q financial results briefing yesterday, chief financial officer Catherine Lee said that, while “expenses arising from the recent MRT disruptions incurred this quarter were not significant … the profitability of the train operations will be impacted by the consequential costs” in the next 12 months. SMRT has to wait for the Committee of Inquiry to complete its investigations into the recent train disruptions and release its findings before SMRT can make an assessment on how this will affect profits, she said.

For the record — “SMRT posted S$37 million in net profit for the three months ended Dec 31, a 13.9 per cent decline from S$43 million in the corresponding period a year ago, even as revenue rose 10 per cent to S$268.2 million.
The increase in turnover was driven by higher train and bus ridership, higher taxi rental revenue, as well as higher rental and advertising revenue, the SMRT said. But costs surged due to higher headcount after the opening of Circle Line stages 4 and 5 and increased train runs as well as higher energy prices.” Quote from Today.

SMRT: Ask judge to step down?

In Infrastructure on 03/01/2012 at 5:38 am

PM did the right thing by us S’poreans who use public transport* by appointing a judge that regularly commutes by train as the chairman of the Commitee of Inquiry that willl look into recent train breakdowns. But is this appoitment open to challenge by SMRT?

If SMRT were keen on shareholder value it should ask the judge tasked to lead the Commitee of Inquiry, Chief District Judge of the Subordinate Courts, Mr Tan Siong Thye, to step down because he was reported by ST as saying:

As a daily user of the MRT myself, to and from work for more than 10 years, I share the concerns of many who want to know what went wrong and how to restore confidence in our MRT system.”

He said the breakdowns on Dec 15 and 17 were “quite unprecedented”, adding that “they caused significant disruption and inconvenience to hundreds of thousands of commuters”.

“Such incidents can also potentially pose a public-safety issue if they are not well managed.”

SMRT’s lawyers could cite the legal principle, “Justice must not only be done, but seen to be done”. They could point out that if the judge has been commuting for over 10 yrs (What no can afford car or cab to work meh?), he would have personally experienced the increase in overcrowding and congestation over the years, and that this would prejudice him against SMRT.

(I was an occasional train user but I tried avoiding the trains for the last  few yrs because of the congestion in off-peak hours.  Only since the May GE, have I resumed using SMRT trains during the off-peak periods given the government’s assurances that the trains are less crowded. But it’s all relative. My 88-year mum recently tried taking the SMRT on Saturday mornings around 7.00am. She has returned to taking the bus because she can’t always get a seat even at this time on the train. The bus is almost empty at 7.00 am. If anyone is wondering, she can afford a cab.)

But if SMRT’s lawyers make such a challenge, we could have riots if S’poreans decide to show SMRT and its controlling shareholder, Temasek, what they think of SMRT.

Looks like SMRT is the stock from hell for the time being, just like  Quan Yifeng is the “artiste” from Hell. Buy ComfortDelgro or SBS instead?

*shumething can be right and popular, PAP. Juz because shumething is unpopular, diesn’t mean it’s right, PAP.

“F” word banned by PUB?

In Economy, Infrastructure, Media, Political governance, Tourism, Wit on 27/12/2011 at 6:03 am

Trust a former President’s Scholar to come up with the solution to prevent floods in Singapore. VivianB got PUB to rename “flooding” as “ponding”. Why didn’t Yaacob do this instead of calling a flood a 50-yr event. Well there were two 50-year events in less than two months last year.

Seriously, I don’t think it was VivianB’s idea. Likely to be the new CEO of PUB that is behind the renaming. He after all blames us for the floods, saying S’poreans took things for granted*. I say to him, “Don’t try to deflect blame like SMRT’s CEO who told us to guard the trains when there was a security break-in. PUB did not do it’s job.

Ain’t this renaming juz daft and misleading? PUB said of the heavy rain last Friday “there was no flooding at Orchard Road … However, water ponded at the open area of Liat Towers, the underpass between Lucky Plaza and Ngee Ann City, and the basement of Lucky Plaza due to the sustained heavy downpour”.

Sorry PUB, these places were flooded. The ponds were at least ankle deep, at Starbucks, customers walked on chairs to get out, and shops had to close**.

I’m glad that MediaCorp didn’t buy into this euphemism. They called these “flash floods”, as they used to. As to ST, they tried to be truthful, while keeping VivianB and PUB onside. No wonder SPH is such a good dividend payer, while unlisted MediaCorp continues to struggle financially.

If VivianB and PUB were doing their very best to ensure that tourists are not scared off (Remember that the retail trade is tourist dependent to keep profitable and that the overall economy is heading for a slowdown, if not a recession), they failed as far as Malaysia is concerned.  Bernama reported:

Flash Floods In Several Parts Of Singapore Including Orchard Road

Flash floods hits several areas of Singapore including the republic’s most famous shopping alley, Orchard Road, following prolonged heavy rain in the southern and central parts of the city state Friday …

Nice try guys. But better for the economy, retailers and S’pore’s image if the PUB improved its “ponding” prevention measures, not try to play word games.

—-

*”But maybe we have also become victims of own success. Because we have been so successful, alleviating floods, that we have not seen a flood situation for a long time. So when it came, it did catch Singaporeans by surprise.”  Channel News Asia

**How Today reported the situation

The underpass between Lucky Plaza and Ngee Ann City remained closed yesterday evening. Some shop owners at the ground floor of Lucky Plaza said that water levels were ankle-high, but the situation this time was better than during previous floods.

At retail store Giordano, store in-charge Lyn Molino estimated losses of up to S$7,000 and said that customers were not only deterred by the wet floors but also by the stench from yesterday’s floodwaters. “This is supposed to be a good opportunity for us to have extra earnings but it has all been affected,” she said.

The floodwaters also washed out business at Starbucks and fast-food restaurant Wendy’s, among other establishments, at Liat Towers. Wendy’s manager (marketing and branding) Seng Woon Fa estimated losses of about 60 per cent of the day’s earnings. “We are now just busy cleaning up and hope to resume business as soon as possible … we are still checking if any equipment is spoiled,” he said.

SMRT: Waz missing from board’s apology?

In Infrastructure on 22/12/2011 at 6:34 pm

The directors did not apologise for the racist remarks of a member of their PR team that “one of the reasons for SMRT’s unpreparedness to deal with the disruptions last week was … the bad command of English by SMRT’s Malay and Indian staff.”*

The original allegation was made by a PAP MP and he has not retracted this statement, even though he has apologised for his personal remarks on the quality of English spoken by Malays and Indians. http://atans1.wordpress.com/2011/12/22/smrt-racist-pr-team/

As neither SMRT nor the directors have denied that an employee made this comment to the PAP MP, and the MP has not withdrawn the allegation, the public has to assume that the MP is telling the truth.

They have not also apologised for or clarified or disassociated SMRT from the remarks made by SVP Goh Kong Chee, the head of communications, from which one can draw the reasonable inference that SMRT property must never ever be damaged to save lives even if the emergency systems do not work.   http://atans1.wordpress.com/2011/12/18/smrt-svp-is-great-believer-in-shareholder-value/

http://atans1.wordpress.com/2011/12/17/smrt-another-commuters-can-choose-comment/

SMRT is dysfunctional from the board down.

———

Update on 23 December at 9.05am

BlogTV has come out to both deny that a PR person made a racist remark and at the same implied that the MP was hard of hearing. Either that or, a reasonable inference is that Seng Han Thong is a casual racist to this bones in missing the word “Chinese”.

“A comment was made by SMRT’s Senior Vice President for Communication and Services Goh Chee Kong in response to a question on how SMRT planned to improve its communication with passengers.” This was broadcast over the radio:

““What we’re mindful of is that our people, our staff at the stations and in the trains may not be making sufficient announcements and also good enough announcements. And that’s because our staff of different races, it could be Malay, Chinese, or Indians or any other race, they sometimes find it difficult to speak in English. However we’ve encouraged them to make the announcements and not to worry about that……………………”

– BlogTV Facebook

SMRT: Racist PR team?

In Infrastructure on 22/12/2011 at 9:13 am

Hey S’poreans, don’t juz “blast” PAP “Flame on” MP for his racist comments, “I noticed that the PR mentioned that some of the staff because they are Malay, they are Indian, they can’t converse in English good, well enough, so that also deters them, from (sic) but I think we accept broken English.”

Remember, he was also quoting SMRT (SVP Goh “You die first, don’t damage SMRT property”?). According to Yahoo!, “During the latest episode of “Blog.TV” on Channel NewsAsia on Monday, the MP for Ang Mo Kio GRC had said one of the reasons for SMRT’s unpreparedness to deal with the disruptions last week was, according to the company’s public relations team, the bad command of English by SMRT’s Malay and Indian staff.”

If SMRT does not come out to deny that one of its PR  persons made the racist comment, then we have to assume that the remark was made. Juz like the assumption that SMRT places a higher priority on its property than commuters dying or being put in distress. Remember SMRT never clarified SVP’s Goh comments on damaging its property to save lives if the emergency syatems did not work. They were not working when SVP Goh made his remarks about not ever damaging SMRT property.

http://atans1.wordpress.com/2011/12/18/smrt-svp-is-great-believer-in-shareholder-value/

http://atans1.wordpress.com/2011/12/17/smrt-another-commuters-can-choose-comment/

Phew, glad I’ve not bot SMRT shares yet. What a bunch of inept managers. According to Senang Diri, there are possibly several ex-SAF colonels in SMRT. Our neighbours must be watching with amusement. We may have the “betterest” weopens, but are our officers any gd? Looks not judging by those ex-colonels in SMRT.

Still keep an eye on SMRT. If senior managers are culled, and new gd ones brought in, the stock could be interesting. I’m putting it on my “watch” list.

SMRT v Delgro: Who treats us better?

In Infrastructure on 22/12/2011 at 8:48 am

Depends on what you mean by “us”.

Usually when I have to go to and from Raffles City or Place, or Shenton Way, I take the bus, as it is the most convenient means of transport (driving included).

On Tuesday at about 4.20pm, I was at Outram and decided to take the train to Eunos and then switch to a bus to return home. When I boarded the train, it was full. I was very fortunate to get a seat as I had a heavy load (I had juz bot six books). When it got to Raffles Place, more people entered than departed. But the number entering was light (The slaves don’t leave until 5.30pm at the earliest). But at Raffles City, the train became very packed as masses got in, and not so many left. The train got less crowded at Bugis. But until Eunos it was full (but not packed), standing room only, as more people got off than in And this was at 4.20- 4.40pm!

Now at 4.20 -  4.40pm if I were at Raffles Place or City, I would have no problem getting a seat on the bus. The bus would only be at best three-quarters full of sitting passengers.

Draw your own conclusions.

As an investor, I can draw the conclusion that Comfort Delgro is not extracting full value from commuters. This could affect shareholder value? Management should learn from SMRT. Maybe bring in SVP “Better you die than my train or bus gets damaged” Goh Kong Chee from SMRT*

*OK, OK. I exaggerate a little, but not that much

http://atans1.wordpress.com/2011/12/18/smrt-svp-is-great-believer-in-shareholder-value/

http://atans1.wordpress.com/2011/12/17/smrt-another-commuters-can-choose-comment/

SMRT: Another dumb statement

In Infrastructure on 22/12/2011 at 5:30 am

Is SMRT the place where foot-in-mouthers find jobs. Seems like it.

Here’s another silly, dumb statement that SVP Goh must take responsibility for since he is head of communications. Last week, when SMRT raised its taxi fares it said, “our drivers need a more substantial level of income, not just lower costs or rental rates, in order to cope with the increasing cost of living and higher diesel prices, and continue their businesses”. Also, it had to “keep pace with the fare revision by other taxi operators”.

Juz wondering. Has SMRT tried lowering costs and rentals before raising fares? And if not why not? And ever heard of competing by increasing demand via lower fares?

Also if Mr Goh is the kind of person one gets when one hires a retired SAF colonel and MINDEF spokeman? Trying to justify the need for another FT PR or public communications head, rather than a true blue S’porean.

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