Singapore Post Ltd. (SingPost) has announced a special dividend following the sale of its Australian business, yet details on a strategic reset remain absent, according to S&P Global Ratings. This lack of clarity has left SingPost’s future strategy and leverage policy uncertain, keeping its ratings on CreditWatch negative since December 2024.
The sale of the Australian business, which accounted for approximately 50% of SingPost’s operating profit for fiscal 2025, was expected to be accompanied by a strategic reset. However, the announcement did not include plans for the use of sale proceeds beyond repaying Australian dollar-denominated debt. This omission has raised concerns about how SingPost will address the structural decline in its core logistics business, which faces challenges such as declining mail volumes and high fixed costs.
S&P Global Ratings anticipates that SingPost will reveal its strategic plans in the first half of fiscal 2026, ending 30 September 2025. The company’s management changes are ongoing, with a new chief financial officer and chief operating officer appointed in January 2025, but the CEO position remains vacant.
The ratings agency aims to resolve the CreditWatch placement once SingPost discloses its strategy. This will include a review of management and governance, which is currently assessed as neutral, following the termination of three top executives in December 2024. The ‘BBB’ long-term issuer credit rating and ‘BB+’ issue rating on SingPost’s subordinated perpetual securities remain under scrutiny, reflecting the uncertainty surrounding the company’s strategic direction.
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