ST Engineering's net profit slips 12% to $111.5m

It lost $8.1m due to the weak marine industry conditions.

With the weak industry conditions in the marine sector, Singapore Technologies Engineering recorded a 12% lower net profits attributable to shareholders to $111.5m for the past quarter ending in June.

According to the group, it reflected an $8.1m loss from the marine sector. This came even with the 8% higher revenue at $1.76b.

At the business sector level compared to the same period last year, revenue for the Aerospace sector was comparable at $639m, and its PBT grew 6% to $78.9m from $74.2m.

The Electronics sector saw a 40% year-on-year increase in its second quarter revenue to $621m from $445m largely due to the modification of estimates of revenue recognition for long term contracts from milestone completion per customer acceptance to monthly work done. Its PBT remained flat at $52.1m due to less favourable sales mix.

Meanwhile, the revenue for the Land Systems sector at $302m was flat year-on-year, and its PBT at $29.3m was comparable due mainly to the absence of a divestment gain in the same period last year. The Marine sector posted 34% drop in revenue to $163m from $248m and incurred a loss before tax of $8.1m versus a PBT of $20.4m a year ago, due mainly to the weak industry conditions and its US operations.

Its commercial sales and defence sales accounted for 64% or $1.1b and 36% or $0.7b respectively of the Group’s 2Q2017 revenue. Order book remained strong at $13.5b, compared to $13.3b as at end March 2017. The Group expects to deliver $2.1b of orders in the rest of 2017. Cash and cash equivalents including funds under management remained high at $1.3b after payment of the FY2016 final dividend of $312m.

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