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ST Engineering profits climbed 18% to $138.2m in Q2

Singapore Business Review logo Singapore Business Review 14/8/2019 Staff Reporter
ST Engineering profits climbed 18% to $138.2m in Q2 © Provided by Charlton Media Group ST Engineering profits climbed 18% to $138.2m in Q2

Profit growth from the marine sector countered declines from other divisions.

Singapore Technologies Engineering (ST Engineering) popped the champagne as its profits rose 18% YoY to $138.2m in Q2 from $117.5m in 2018. Revenues edged up 8% YoY to $1.78b from $1.65b.

Its H1 profit also grew 14% to $269.3m from $235.2m in H1 2018. Revenue for the same period reached $3.51b, up 6% YoY from $3.30b. Interim dividend is at $0.05 apiece.

At the business sectors, revenue for the aerospace sector was up 17% YoY to $836m in Q2, with MRA Systems as the main contributor and partly offset by the lower engine sales and Jet Airways revenue. Its net profit was 4% lower YoY at $64.2m, no thanks to the absence of 2018 profits arising from the divestment of an associated company and opportunistic engine sales.

Revenue for the electronics sector was down 3% YoY to $495m over the same period whilst net profit was 5% YoY lower to $44.3m, largely due to timing in revenue recognition for projects and higher selling and distribution expenses as a result of increased sales activities to support international expansion.

ST Engineering's land systems operations saw revenues up 10% to $296m, driven by broad-based growth across its business groups. Its net profit remained flat at $20.3m as investments in its robotics & autonomous systems business division grew.

The marine sector's revenue was $139m in Q2, down 6% YoY with lower shipbuilding revenue contribution from Singapore. In contrast, net profit surged 55% YoY to $14.3m, driven by improved shipbuilding performance in the US and contributions from its engineering business group.

Lastly, the Others revenue skyrocketed 75% YoY to $14m from $8m, mainly contributed by higher sales from Miltope, its ruggedised computer business, with lower net loss of $4.9m in the absence of MTN redemption related costs.

In addition, the firm saw about $2.5b worth of new contracts for Q2, which comprised the $1b contract for the first Polar Security Cutter, $809m from the aerospace sector and $702m from the electronics sector.

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