SingPost directors quizzed about future strategies and CEO at AGM

[SINGAPORE] National postal service provider Singapore Post’s (SingPost) board was pressed by shareholders at its annual general meeting (AGM) on Wednesday (Jul 23) for more information about the path forward as its search for a new chief executive officer drags on.

Meanwhile, chairman Simon Israel, at his last SingPost AGM before stepping down, disclosed that the decision of divesting SingPost Centre, the flagship headquarters building in Paya Lebar, now lies with the reconstituted board, which will review whether the property is non-core to the group and is to be sold.

He and other directors were quizzed at the listed firm’s 33rd AGM held at Suntec Singapore about the reset strategy that shareholders have been looking forward to since they approved the divestment of the Australian logistics business Freight Management Holdings for A$1 billion (about S$845 million) in March.

They were also queried about the CEO who would replace the dismissed predecessor and be tasked with executing the reset strategy. Group CEO Vincent Phang was fired together with group chief financial officer Vincent Yik and CEO of international business unit Li Yu in December 2024 over the alleged mishandling of a whistle-blower’s report.

The questions from shareholders came as the presentation at the AGM left them none the wiser about SingPost’s plans or strategies to replace the divested Australian logistics business, which had been a core business and key financial contributor.

This caused a shareholder to express his displeasure that the reconstituted seven-member board, including incoming chairman Teo Swee Lian, did not have an idea as yet about the path forward, despite the board renewal and the passage of time.

“We came here with a lot of expectation… I feel very disappointed… We already know the current situation, but what’s next? What kind of CEO are you looking for to run whatever remains (under) SingPost?

“You tell us to be patient. We have been patient all this while. Today is an important day; I thought you should have at least given us some guidance that (would signal) there is hope for SingPost.”

This shareholder also asked the recently appointed non-executive, non-independent director Gan Siok Hoon – deputy group chief corporate officer of Singtel – to share the views of the telecommunications company, considering it is SingPost’s major shareholder.

Israel pointed out that Gan is not the spokesperson for Singtel.

Questions over a new CEO

Another shareholder also asked the board about the kind of CEO it is looking for, and suggested that a new helmsman be appointed only when the board has a clear strategy.

“Because your strategy is still in a little bit of a flux, you may hire a CEO and end up with the CEO (having) nothing much to run… Should you be a bit cautious in terms of hiring the CEO at this point, or should you continue to run with an interim CEO (until the board has) more certainty? Because I also think the kind of CEO you need also depends on the strategy that you think the company should pursue.”

Teo asked for patience and the opportunity for her board to do a review as these are “not easy issues”. Also, she flagged that there will be a conversation with “very important stakeholders” on what to do.

She added: “I do not know of any high-performing organisation that wants to continue the situation without the CEO. I think that’s not best practice, really. So we do have to search for a CEO. We’re very fortunate, we have the candidates… We will, in due course, identify who the person will be.”

The CEO must have leadership quality, think out of the box with a free hand, and be enterprising, Teo elaborated.

“We’re looking for people who can actually take a company which is not in the best situation, and still find what can be done in order to get a pathway for (us) to be sustainable in the long term.”

A shareholder suggested that SingPost take the privatisation route and liquidate its assets, including SingPost Centre, and return capital to shareholders. But Israel replied that privatisation is not within the board’s scope of work and that it requires an external actor.

Regarding SingPost Centre

The outgoing chairman also told shareholders that the SingPost Centre would be “the last big piece” to unlock value, after SingPost sold its Australian logistics business in March and its freight-forwarding business this week, as well as the earlier sale-and-leaseback bid of 10 HDB shophouses for S$50 million.

SingPost Centre was defined as “non-core” following a strategic review in 2023-2024, because the board did not think SingPost was a property company, Israel said. The directors have not decided on the timing of the divestment even though the property, last valued at about S$1 billion, has since been earmarked for sale.

Israel pointed out that the board has never set out a timeline for the sale of this asset.

He added: “Now that brings us to today’s circumstances… It’s quite clear that the short-term earnings of SingPost, while it works its way through its strategy and what the future holds and which options it’s going to pursue, are underwritten by the property business.

“So it really will be for the board in the future to define whether that remains non-core, it becomes core, or whatever the options are around that property.”

The business contributed an operating profit of S$48.4 million for the full year ended Mar 31 – more than any other segment, and higher than the total group operating profit of S$44.3 million after accounting for operating losses in some segments.

All 13 resolutions were approved at the AGM that lasted more than 1.5 hours, including for a special dividend of S$0.09 per share to be paid out of the sale proceeds of the Australian logistics business.

The counter closed up 2.3 per cent or S$0.015 at S$0.655 on Wednesday.