SINGAPORE – Half of the breakdowns on the Circle Line (CCL) between April 2023 and March 2024 were due to upgrading works to integrate existing systems with the line’s three final MRT stations slated to be ready in 2026, operator SMRT said.
The reliability of the MRT line “will go straight up” when the full line is complete, said SMRT group chief executive Ngien Hoon Ping on July 31.
The CCL was the least reliable among five MRT lines in Singapore and the only one that posted a dip in performance, based on the latest rail reliability figures released by the authorities in July. The Thomson-East Coast Line (TEL) was not included in the report.
CCL trains went an average of 1.03 million train-km between delays in the 12 months ending March 2024, sliding from 1.21 million train-km in 2023 and 1.84 million train-km in 2022.
The line’s final three stops will close the loop between HarbourFront and Marina Bay.
Mr Ngien said the work to complete this final stage and integrate it with the rest of the line is highly complex, as multiple interconnected systems are involved. Done within the allocated window of time for engineering work on the line, the project affects the execution of regular maintenance work.
The SMRT-run North-South and East-West MRT lines have improved in reliability, boosted by the completion of a multi-year overhaul in 2023.
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In SMRT Group’s latest financial report released on July 31, SMRT Trains announced a revenue of $886.7 million for the 2023/24 financial year – 9 per cent higher than the previous year’s $813.2 million. It attributed this to higher average fares and the increase in its daily ridership.
SMRT Trains’ total annual ridership was 717 million for the financial year – the first year that ridership on the TEL was included. This continues the uptrend from 636 million in the previous financial year and 480 million in 2021/22.
However, the latest ridership figures are still about 11 per cent lower than pre-Covid-19 levels.
Its 2023/24 profit after tax was down 82 per cent to $7.5 million from the previous year, when the rail operator received a $40.8 million dividend payout from its subsidiary SMRT TEL, which operates the TEL.
The payout was from accumulated profits since the TEL started operations in January 2020.
In response to The Straits Times, SMRT said ridership on the TEL, after seven new stations under the fourth stage of the line opened in June, has an average daily tally of around 250,000. This is up from 177,000 in October 2023.
At $6.2 million, SMRT Trains’ earnings before interest and tax for the 2023/24 financial year were comparable to the $6.1 million in the previous year. Higher electricity and staff costs eroded the higher revenue for the period.
SMRT also said on July 31 that it is restructuring its businesses into two pillars: the public transport business consisting of SMRT Trains and SMRT Buses; and the “non-fare” businesses comprising Strides, which offers engineering, digital and mobility services, and Stellar Lifestyle, which manages retail and advertising spaces.
SMRT chairman Seah Moon Ming said this structure would enable the company to continue focusing on fulfilling the requirements set by the authorities when it comes to public transport, while developing the other businesses.
“I must have a free hand, then I can drive the return on equity to be close to 10 per cent. That’s what we want to achieve five years from now,” he added.
He also sees business opportunities with the upcoming cross-border Rapid Transit System Link, which SMRT will be operating through a joint venture with Malaysian public transport firm Prasarana. Passenger service is expected to start by December 2026.
Mr Seah also weighed in on EVCo, the electric van leasing company that went into liquidation in March. ST reported it was declared insolvent with debts of almost $50 million. This came months after its chief executive officer and former chief financial officer were arrested in late 2023 after irregularities in the firm were detected and an internal audit was started.
Set up in 2022, EVCo is a Singapore joint venture between SMRT’s business arm Strides Holdings and Dishangtie Green Technology (Hong Kong) to lease electric commercial vehicles to small- and medium-sized enterprises.
Mr Seah said SMRT became aware of the failings when EVCo requested additional capital in October 2023.
In his first public comments on the matter, he added: “EVCo had acquired far more vehicles than secured customers, and had no real prospect of meeting the sales targets. It was also burdened by excessive bank borrowing.
“There was no way for the company to be sustainable or profitable. Rapid cash burn led to the eventual collapse of EVCo.”
The total loss to Strides Holdings was its shareholding value of $6 million, Mr Seah said.
He declined to comment on the two executives and their role in EVCo’s financial losses, citing the ongoing police investigations.
“We are not that perfect at times,” Mr Seah said, adding that SMRT is beefing up its requirements when it comes to joint ventures.
Where SMRT has a majority stake, it must be able to monitor the financials of a joint venture company every week going forward, as opposed to relying on reports shared by the joint venture firm, he added.
Clear financial guard rails will also be in place to prevent excessive borrowing and ensure that there is “good and proper” selection of people taking on the roles of CEO and CFO.
“If you have a good CEO and good CFO, then the company will be in good shape.”