Earnings season has come and gone.
Given that many companies reported their results in the past few weeks, I thought it may be useful to summarise the results of some of these companies in three distinct buckets – positive, negative, mixed. This categorization will give our readers a quick overview of the performances of these companies.
With that in mind, we will focus on two of those companies that delivered growth in their latest results.
1. DBS Group Holdings Ltd (SGX: D05), or DBS for short, reported growth in its 2018 second-quarter earnings results.
For the quarter ended 30 June 2018, total income grew by 10% from a year ago to S$3.20 billion. Net interest income (income from loans) grew 18% year-on-year to S$2.22 billion, driven by improvement in net interest margin and loan volume growth. Similarly, net fee income increased 11% to S$ 706 million, led by growth in wealth management and cards. As a result, net profit jumped 20% to S$1.37 billion.
DBS CEO Piyush Gupta commented in the earnings update:
“The record first-half earnings demonstrate once again the breadth and quality of our franchise, while the higher returns demonstrate the improved profitability of our businesses as interest rates and credit costs normalise. The industry accolades we were recently awarded, including the World’s Best Digital Bank by Euromoney for a second time in three years, attest to the strides we have made in delivering customer value. Amidst heightened uncertainty and market volatility, business momentum was sustained in the second quarter. While there are gathering clouds, the region’s prospects remain intact, enabling us to continue capturing growth opportunities and generating stronger shareholder returns in the coming quarters.”
For the first half of 2018, DBS Group declared an interim dividend per share of 60 cents, up 82% from the 33 cents declared for the first half of 2017.
2. Oversea-Chinese Banking Corp Limited (SGX: O39), or OCBC for short, is the another bank that reported its 2018 second-quarter recently.
For the quarter ended 30 June 2018, total income grew by 5% from a year ago to S$2.47 billion. Net interest income (income from loans) grew 8% year-on-year to S$1.45 billion, driven by improvement in net interest margin and loan volume growth. Similarly, non-interest income increased 2% to S$ 1.02 billion as a result of growth across the board. As a result, net profit jumped 16% to a record S$1.21 billion.
CEO Samuel Tsien summarised the latest quarter performance:
“Our record quarterly performance reflects the resilience and strong foundation for growth of our diversified banking, wealth management and insurance franchise. Yearly and quarterly revenue growth was driven by increases in both net interest and non-interest income. 2Q18 net interest income rose from a year ago, driven by robust loan growth and improved asset yields in both the Singapore and Malaysia markets. Non-interest income growth was broad-based, led by higher fees, trading income and insurance income. Operating expenses were well-managed and credit cost remained low.
The operating environment is increasingly challenging and we are watchful of the severe implications to the global economy and financial markets from the escalating trade and political tensions. With our strong and diversified franchise, capital and balance sheet, we are well-positioned and committed to supporting our customers and pursuing long-term sustainable and stable growth for our shareholders.”
For the quarter, OCBC declared an interim dividend per share of 20 cents, up 2 cents from a year ago.
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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned. Motley Fool Singapore has a recommendation for DBS Group Holdings Ltd.