There is a story going around that ComfortDelgro’s management sent an e-mail to SMRT’s management saying, “Thanks for the income opportunity. Christmas came early for us. Merry Christmas and a Happy New Year. Keep on doing what you are doing. Our mgt and shareholders love it.”
Seriously, I hear that analysts are tweaking their numbers for ComfortDelgro upwards to take account of a temporary switch from trains to bus, while commuters await further developments at SMRT.
As reported earlier analysts are lowering lower revenue forecasts for SMRT to take account of the coming fines, severance packages for senior managers, and higher maintenace costs. Compared to other metro train systems, SMRT has lower maintance costs as a % of revenue. But don’t start ranting like Goh Meng Seng. Our MRT system is a baby by int’l standards. London and NY have lines going back to the late 19th century. HK’s system is older. Only Shanghai, among major int’l cities, has a system that is younger than ours.
(To see where SMRT’s incremental profits come from see slides 9, 29, 30. They come from rents and ads not from fares. Fare growth is “peanuts” see slide 8 http://www.smrt.com.sg/investors/documents/presentations/DB_Conference_Investor_presentation_1QFY12.pdf )
SMRT shares fell 3.6% on Monday, and 1.1% on Tuesday the lowest in three months, following the three breakdowns last week. Looks like the head of communications attempt to show how he and SMRT valued shareholder failed. SVP Goh Chee Kong (retired SAF colonel and MINDEF spokesman) told us publicly that that it is better for commuters to die rather than damage SMRT property if emergency systems fail to work. (OK, OK. I exaggerate a little, but not that much
Failed twice. He can’t prevent SMRT share price from failing, despite showing us publicly that he is a failure, morally and ethically. Hmm, wonder if his parents, wife and children still respect him?