Financial Analysis of Singapore Post: Liquidity, Profitability, Solvency and Turnover Ratios

Finance

Contents
Introduction...........................................................................................................................................2
Financial performance...........................................................................................................................2
Liquidity ratios...................................................................................................................................3
Profitability ratios..............................................................................................................................4
Solvency ratio....................................................................................................................................9
Turnover ratios................................................................................................................................11
Conclusion...........................................................................................................................................14
References...........................................................................................................................................16
Appendix.............................................................................................................................................18

Introduction
In order to demonstrate the understanding of Singapore post`s financial situation, the
analytical report has been produced in terms of current position and its compliance with the
CSR activities and corporate governance. Singapore post is a conglomerate of many
subsidiaries. The company envisions becoming a global leader in communications and
ecommerce logistics. Subsidiaries such as SP ecommerce, Famous Holdings, Speedpost,
lock+store, quantium solutions, and couriersPlease.
Singapore post offers local and international postal services, letter-shopping, warehousing, e-
commerce logistics, mailroom management, end-to-end mail services, data printing, and
fright services. The company is headquartered in Singapore. The company has generated a
revenue of $1.1 billion with a workforce of 1900 employees. Main competitors of Singapore
Post are CH Robinson, Purolator, and DHL. The company is a public and independent
company. The CEO of the company is Paul William Coutts. Singapore Post limited is a
leading company that offers retail, logistics, and mail solutions in Asia Pacific region and
Singapore. The company is designated as public postal licensee. The company is one of the
largest retail distributor network of Singapore with extensive tri-channel of over 60 post
offices and 300 odd self-service automated machines (SAM) with online shopping and portal
vPOST. The company has to comply the obligation that are under Cap. 50 and SGX-ST
(Singapore Exchange) listing rules. The company follows international SFRS, which is very
much similar to International Financial reporting standards (IFRS).
Financial performance
Financial performance can be effectively derived only by analysing the financial statements
of the company. To examine the financial performance of several indicators and ratios of
Singapore Post will be analysed. The comparison can be made only between different
subsidiaries of Singa post. Although, there are many types of financial analysis such as

vertical, profitability, liquidity, efficiency, and leverage. Ratio analysis is an measuring tool
used by the company or the stakeholders to examine the performance of the organisation. The
use of analysis is not limited to stakeholders, investors, suppliers, and customers. The
analysis is from year to year, which is horizontal analysis. Each subsidiaries will be analysed-
Liquidity ratios
It is defined as a financial metrics that determines whether the company is able to pay off its
current liabilities. Payment obligation should not include debt obligations which are long
term and are capitalised. A high liquidity ratio means that the company is able to pay off its
current obligations from the current assets. A high liquidity ratio means that the organisation
is in good condition to pay off its short term outstanding debts. To order to analyse the
liquidity, the analysis will consider current ratio and quick ratio.
Current ratio
This ratio decides that how efficient is the organisation to pay off its short-term obligations.
There is an ideal ratio i.e. ratio 1.2 to 2 discloses that company is good enough to pay off its
obligations. Whereas, if the current ratio is below 1 then the organisation does not have
appropriate current assets in order to cover short term obligations.
2014 2015 2016 2017 2018
0.000
0.500
1.000
1.500
2.000
2.500
Current ratio