Singapore Technologies Engineering Ltd (ST Engineering) announced financial results for its first quarter ended 31 March 2016 (1Q2016).
Group revenue for 1Q2016 was 8% higher at $1.63b compared to $1.51b the year before, with higher sales from the Aerospace and Electronics sectors. Quarterly Profit before tax (PBT) for the Group was $130.4m, down 13% from $150.5m, and Quarterly net profit after tax (Net profit) for the Group was $110.2m, down 15% from $130.0m as profits from Land Systems and Marine sectors declined.
At the business level compared to the same period last year, revenue for the Aerospace sector was 27% higher at $622m from $489m, mainly driven by the contribution of a new subsidiary, Elbe Flugzeugwerke. PBT for the Aerospace sector remained comparable at $75.2m. Arising from higher value project milestone completions, revenue for the Electronics sector increased 28% to $457m from $356m and its PBT up 13% to $39.6m from $34.9m. The Land Systems sector recorded lower revenue for all its business groups, resulting in a 18% drop in revenue to $284m from $346m, and 28% drop in PBT to $11.6m from $16.2m. In the Marine sector, weaker shipbuilding performance in Singapore and US operations resulted in revenue of $213m, 24% lower compared to $280m, and PBT of $3.4m, 85% down from $23.4m.
”For the first quarter of 2016, the Group reported higher Revenue, but lower PBT compared to the same quarter last year. Our business operations, including shipbuilding, continue to face industry headwinds, the impact of slow-down in China and overall, an uncertain global economic outlook.
Notwithstanding the economic conditions, the quarter ended with an order book of $11.5b, and we continue to hold cash and cash equivalents, including funds under management, at a healthy level of $1.5b.
Against a weakening global economic environment, the Group adopts a cautious approach to its businesses. Barring unforeseen circumstances, the Group expects FY2016 Revenue to be higher, and PBT to be comparable to FY2015. We continue to monitor the situation closely and will provide an update at mid-year.” ~Tan Pheng Hock, President & CEO, ST Engineering
