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SMRT Trains reports after-tax loss of S$86 million for FY2018, citing higher operating expenses and drop in ridership and fares

In an annual operations review report on Sunday (1 July), SMRT Trains announced an after-tax loss of S$86 million for the 2018 financial year ending 31 March due to higher maintenance expenses and said that the loss follows an after-tax profit of S$26 million for the previous financial year.

SMRT Trains, which operates and maintains the North-South and East-West Lines, the Circle Line and the Bukit Panjang Light Rail Transit system, noted that its lines cover over 148km of rail tracks across 106 stations, and added that its rail network will expand to include the Thomson-East Coast Line in 2019.

It attributed the drop in revenue to the fall in ridership and lower average fares and highlighted that ridership fell from 768 million to 753 million, with average weekday ridership at 2,258, down from 2,353 the previous year.

Meanwhile, it pointed out that operating expenses jumped from S$785 million to S$838 million due to higher maintenance costs for the ageing rail network and higher loss on disposal of property, plant and equipment.

In the report, Seah Moon Ming, SMRT Chairman said, "SMRT Trains is committed to improving reliability and enhancing commuter experience. We are building indigenous rail engineering capabilities particularly in predictive maintenance and electronic card repairs and upgrades to benefit the rail network. We are adopting Kaizen methodology company-wide for continuous improvement in all areas of our work."

Lee Ling Wee, CEO of SMRT Trains, stated, "We recognise that commuter satisfaction has taken a dip in the last year, especially after the commencement of the new signalling system in mid-2017 and the two incidents in late 2017 that affected services on the NorthSouth and East-West Lines (NSEWL)."

"Learning from the 7 October tunnel flooding episode, we have tightened work processes and supervisory checks across all levels in the organisation, and will use resources more effectively as we get our renewal and maintenance efforts firmly back on track in building infrastructure and facilities management," he added.

Mr Lee then said, "Improving rail reliability is crucial in ensuring a seamless journey. In this regard, the team has made good progress. In the last five years, SMRT Trains and the Land Transport Authority have invested tremendous efforts to modernise and renew the ageing NSEWL. We have since marked the completion of several key projects such as sleeper replacement and power rail replacement. "

"These have translated to positive results. From April 2017 to March 2018, the mean kilometres between failure (MKBF) for the Circle Line (CCL) improved more than twofold to 665,000km, while the numbers for the East-West Line went up to 171,000km. The NorthSouth Line clocked 97,000km, due to initial teething issues on the new signalling system. We are happy to note that the system has stabilised considerably in recent months, bringing you smoother and uninterrupted journeys. We look forward to achieving the stretched MKBF target set by the authorities,"

Mr Lee added, "Train stations will continue to experience early closure and late opening on selected days to increase engineering hours for the remaining renewals and upgrades in the pipeline. On that note, we thank you for your understanding and patience for the inconveniences as we expedite our works." and said "Apart from our multi-year, multiproject efforts on the NSEWL, other exciting milestones await us. As our network expands to include the Thomson-East Coast Line in end 2019 and the full CCL loop by 2025, we look forward to connecting more commuters to more places across the island,"

The report also noted that SMRT Trains' employee accident frequency rate for FY2018 was 1.44, compared to 1.14 in the previous financial year. However, SMRT Trains stressed that this was still lower than the logistics and transport industry average of 3.0.