20150611 Temasek’s NOL about to sink, questionable leadership

PAP claims to have a meritocratic system where only best and brightest are appointed to leadership positions in the public and private sector. Sub par performance from such leaders should therefore not be tolerated since they are paid millions annually.

In 2011, ex SAF scholar, Lt-General Ng Yat Chung was appointed as CEO of NOL. But after almost 4 years, NOL has struggled to stay afloat in a sea of red ink. The possibility of throwing more tax dollars to stem the bleeding has been increasing by the day. Some statistics:

NOL’s revenue has decreased slightly with consistent losses in the last 4 years.

Since 2010, NOL’s debt has tripled to $5.2 billion.

Image source: ft.com

Ng’s abysmal performance should not surprise anyone because he had ZERO experience in the shipping industry prior to joining NOL. Ng was a career soldier from 1979 to 2007, parachuted into Temasek from 2007 to 2011. Like every PAP scholar, Ng’s phenomenal rise to the rank of Lieutenant-General was based solely on his academic results. Scholars are actually better off in the classroom instead of courting disasters using tax dollars trying to fit the real world into their theories.

NOL share price reflects Ng’s performance as well as investors’ (lack of) confidence.

Temasek has been NOL’s largest shareholder since 1974. 34 years after its public listing in 1981, its share price is now 80% .. underwater. Through rights issues, its outstanding shares have ballooned from 722 million in 1997 to 2.5 billion in 2015.

Shares of profitable companies increase in price over the long term but NOL has achieved the reverse.

Image source: ft.com

It appears our GLCs can only perform well locally when given steroids by the PAP but not internationally. For Ng’s abysmal performance, he was rewarded instead of being shown the door.

In 2014, Ng received between US$2.3 million and US$2.5 million. (pg 42)

In 2012 (pg 36) and 2013 (pg 42), Ng’s compensation was between US$2.5 million and US$2.7 million. In 2011, Ng was paid between US$2.15 million and US$2.3 million although he was serving as CEO for only 3 months.

Ng’s ‘achievements’ in NOL:
– make consistent losses for 4 years,
– decimate the value of existing shares with rights issues,
– increase it debt by more then S$3 billion.

For the above, Ng was rewarded with a total of more than S$10,000,000? Hmm… in which country does such a company exist?

(To rub salt into the wound, NOL stated “the equity incentives is inclusive of the 1,088,000 restricted shares (with a value of S$1,261,144) awarded on 21 October 2011 to compensate for the loss of benefits accruing to Ng Yat Chung by his previous employer prior to joining the Group.” Ng’s previous employer was Temasek Holdings.

Temsaek Holdings owes the public an explanation – how Ng’s accrued benefits could have amounted to S$1,261,144. If accrued benefits totalled S$1.2 million, wasn’t Ng paid a multi-million dollar pay package? As the Chief of Defence Force, Ng could not have earned more than $1 million. Why the huge pay increase less than 4 years after leaving the military? Why did the PAP appoint someone with ZERO experience, pay him millions when there are other more qualified candidates with decades of experience for the job? Temasek should also disclose, in no uncertain terms, how many millions/hundreds of millions from our reserves have been used to compensate its directors and top management.)

NOL seems to be in pretty bad shape despite having Temasek as its largest shareholder for 41 years. One should not expect any book smart CEO with zero relevant experience to turn NOL around in the near future.

NOL has proven it cannot stand on its own 2 feet and will likely be sunk by its continuing losses. Singaporeans can only hope tax dollars will not be used for a bailout.


PAP has mistakenly believed every scholar-general can become a successful CEO with ZERO relevant experience. Scholar generals would not have been able to earn millions if PAP had not parachuted them into GLCs/Temasek. The public perceives this to be a promotion of sorts in order to make way for younger scholars in the military. Whichever way one looks at it, this serves only PAP’s interest.

Ng Yat Chung detail, 050602-F-0193C-114.jpg
Image source: Wikipedia

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5 Responses to 20150611 Temasek’s NOL about to sink, questionable leadership

  1. mike chua says:

    First and foremost, PAP’s model of governance is wrong. Governments are the worse people to go into business for the simple reason that there’s no personal loss. Business is best left to the businessmen.

    Look at the GLCs. They are only profitable within the confines of Singapore because it’s not a level playing field. When faced with real competition in the international arena, they show how incredibly incapable they really are. NOL is one shiny example. I’m sure there are more.

  2. Anonymouse says:

    “SAF” and “talent” put together is an oxymoron.

    Actually, I don’t what’s even the point of SAF anymore when ~40% of the population are foreigners who has the entire SAF outnumbered right here in Singapore by 5:1 and are already “infiltrating” all layers of our industries and infrastructure. If we are screwed either way might as well save that 20% of the national budget.

  3. wongcheokwan says:

    Great article. From your figures, debt=$5.2B. total share=2.5million.

    Therefor each share carry a debt of $2.08. A share is valued at $0.84 on 12 jun.2015.

    Assuming each share can make a profit of 10cts per year.That will take 20yrs to clear the debt.Plus

    another 8yrs to recover capital.By that time many NOL ships will be replaced at ADDITIONAL

    expenditure.Suggest to sell off or merge for salvation.

  4. phillip ang says:

    Suspect more tax dollars will be thrown onto NOL ship just like the $2 billion gifted to SMRT and SBS Transit while slapping commuters with a fare increase.

  5. Pingback: “Sorry” shoudn’t be this hard to say. – Banalysis

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