ST Engineering 2Q 2014 Unaudited Results

 

Singapore Technologies Engineering Ltd (ST Engineering) announced today that the Group posted quarterly revenue of $1.59b for the second quarter ended 30 June 2014 (2Q2014), which is comparable with the prior year’s revenue in the same period.

The Land Systems sector saw lower revenue due to fewer deliveries in its Automotive business group in the second quarter. The other three sectors - Aerospace, Electronics and Marine registered growth of between 6% and 12% year-on-year.

In 2Q2014, all sectors except for the Electronics sector, recorded lower profit before tax (PBT) resulting in a 12% drop in Group PBT to $163.7m from $186.9m in the same period last year. PBT for the Aerospace sector was 9% lower at $72.9m, Land Systems sector was 46% lower at $18.2m and Marine sector was 31% lower at $24.7m. PBT for the Electronics sector was comparable at $48.2m. Net profit after tax (Net Profit) in 2Q2014 for the Group was $133.2m, representing a 10% decrease from $147.9m in the same period last year.

Six Months Results
 

On a half-yearly basis (1H2014), the Group’s financial results were comparable to the same period last year. Group revenue stood at $3.14b, and PBT was $331.6m compared to $345.6m while Net Profit was $270.4m versus $281.9m. Aerospace sector’s revenue of $1.04b was 6% higher from $982m while its PBT was comparable at $147.6m.

The Electronics sector posted comparable revenue and PBT of $749m and $80.5m respectively. Revenue for the Land Systems sector was $618m, down 16% from $738m and its PBT was $37.1m, down 32% from $54.6m in 1H2013. The Marine sector posted revenue of $671m, up 19% from $565m and PBT of $56.2m, a decline of 14% from $65.3m in the same period last year.

“Compared to 2Q2013, 2Q2014 recorded comparable Revenue and a lower PBT. Compared to 1H2013, the Group reported comparable Revenue and PBT for 1H2014. Although the global market remains weak and uncertain, the Group has maintained a strong order book of $13.4b. Cash and cash equivalents including funds under management remained high at $1.8b after payment of the final dividend for FY2013 of $374m. The Board of Directors has approved the payment of an interim ordinary dividend of 4 cents per share, payable on 4 September 2014. Barring unforeseen circumstances, the Group expects to achieve comparable Revenue and PBT for FY2014 vis-à-vis FY2013.” said TAN Pheng Hock, President & CEO, ST Engineering.

Business Highlights
 

In 2Q2014, commercial sales accounted for 62% or $1b of Group revenue. Order book stood at $13.4b as of the end of June 2014, and the Group expects to deliver $2.6b worth of orders in the remaining year.

Total contracts worth about $1.2b were announced in 2Q2014. The Aerospace sector announced $520m worth of contracts for airframe, component and engine maintenance, freighter conversion, cabin modification, engine wash and pilot training. The contracts included a five-year agreement with a regional US airline for heavy maintenance of 42 Embraer E-170 and E-175 aircraft at the sector’s San Antonio facility. The Electronics sector announced contracts of about $580m for its intelligent transportation, satellite and broadband communications, as well as advanced electronics and Information Communications Technologies solutions. The Land Systems arm secured a $100m contract for the supply of 40 MAN A24 articulated buses and 332 MAN A22 12-metre buses to SMRT Buses Ltd.

Interim Dividend
The interim ordinary dividend of 4 cents per ordinary share, as approved by the Board will be paid out to shareholders on 4 September 2014.