SINGAPORE (May 11): ST Engineering reported a 17.8% rise in 1Q18 earnings to $117.7 million from $99.9 million a year ago in 1Q17.
Revenue for the quarter came in 9% higher at $1.65 billion from $1.51 billion a year ago, mainly attributable to higher revenue contribution from the group’s Aeropace, Electronics and Land Systems sectors, but partially offset by lower contribution from its Marine and Others sectors.
The Aerospace sector saw revenue climb 9% y-o-y to $599 million, as all business groups contributed to the improved performance, especially from Component/Engine Repair and Overhaul and Aircraft Maintenance & Modification business groups.
Revenue from the Electronics sector jumped 22% y-o-y to $605 million, from higher project revenue recognition from all three of its business groups.
Land Systems sector’s revenue of $281 million was 3% higher, from higher project revenue recognition from Automotive business group.
Marine sector revenue of $150 million came in 16% lower as revenue recognised from the Shipbuilding and Shiprepair business groups declined.
Lower revenue under “Others” was mainly attributable to lower sales from Miltope.
As cost of sales increased by 10.3% to $1.32 billion, gross profit for 1Q18 stood at $325.9 million, 4.1% higher than $313.1 million in the previous year.
Administrative expenses increased 6.2% to $122.2 million, while other operating expenses were 11.5% up y-o-y at $32.2 million.
Distribution and selling expenses declined by 12.7% to $49.4 million, mainly from lower allowance for doubtful debts for Aerospace and Marine sectors, partially offset by higher expenses incurred for the biennial Singapore Airshow.
Net other income fell 26.1% to $8.63 million, mainly attributable to loss on liquidation of a subsidiary, partially offset by higher government grants
Net finance costs decreased by 59.1% to $2.19 million from $5.37 million a year ago.
The group ended 1Q18 with an order book of $13.4 billion, and it expects to deliver about $3.2 billion in the remaining months of 2018.
Vincent Chong, president and CEO of ST Eng, says, “We started the year with healthy revenue growth and net profit. We also secured numerous contracts including Smart City projects in the past quarter. With a strong order book, the group remains on track for steady growth.”
Shares in ST Eng last traded 2 cents lower at $3.46 on Thursday.
