Singapore Technologies Engineering (ST Engineering) has posted earnings of $296.1 million for the 1HFY2021 ended June, 15% higher than earnings of $257.4 million in the year before.
Correspondingly, earnings per share (EPS) for the period rose 15% y-o-y to 9.50 cents.
This is the first time that the group is reporting its results under its new financial reporting framework since its new organisational structure that was in place since Jan 1.
Under the new structure, the group’s three reportable business segments are Commercial Aerospace (CA), Urban Solutions & Satcom (USS), and Defence & Public Security (DPS).
Group revenue for the half-year period increased by 2% y-o-y to $3.65 billion due to the partial recovery of businesses across Urban Solutions & Satcom and Defence & Public Security, which more than offset the revenue decline in Commercial Aerospace.
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Group net profit was also contributed by the better operating performance of Urban Solutions & Satcom and Defence & Public Security, offset by the lower operating performance of Commercial Aerospace, lower government support and higher tax expense.
Group EBIT grew 13% y-o-y to $355.1 million while group profit before tax (PBT) rose by 19% y-o-y to $339.8 million.
Revenue for the Commercial Aerospace business fell 10% y-o-y to $1.14 billion due to the impact of the Covid-19 pandemic that affected its sub-segments Aerospace MRO and Aerostructure & Systems.
On an h-o-h basis, the business saw a 7% growth in revenue indicating a partial recovery in the segment.
Commercial Aerospace EBIT grew 37% y-o-y to $102.6 million.
Revenue for the Urban Solutions & Satcom rose 12% y-o-y to $528 million due to its Smart Mobility and Satcom segment.
EBIT reversed into the black at $10.8 million from the negative EBIT of $21 million the year before, mainly due to higher revenue and lower operating expenses.
Defence & Public Security reported 8% y-o-y higher revenue of $1.99 billion contributed by the Digital Systems & Cyber, Land Systems and Defence Aerospace sub-segments.
EBIT fell 7% y-o-y to $241.7 million due to lower government support.
In the 2QFY2021, the group scored new contracts totalling some $1.82 billion, bringing its order book to a “robust” $16.8 billion as at June 30.
As at June 30, cash and cash equivalents stood at $583 million.
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For the 1HFY2021, the group has declared an interim dividend of 5.0 cents per share, to be paid out to shareholders on Aug 31.
“We delivered a good set of results for the first half of 2021 amidst a challenging operating environment. We had also secured contract wins across our businesses that led to a robust order book, which continues to provide revenue visibility in the periods ahead,” says Vincent Chong, group president & CEO of ST Engineering.
“We remain steadfast in the pursuit of our strategy to emerge stronger as the business environment improves. The diversity of our business portfolio, and our focus on seizing growth opportunities, coupled with productivity and cost management measures will continue to position us well into the future,” he adds.
Shares in ST Engineering closed 5 cents lower or 1.2% down at $4.03 on Aug 11.
Photo: Albert Chua/The Edge Singapore
