Singapore Technologies Engineering (ST Engineering) shared its 1QFY2021 ended March market update on May 12, highlighting that its cost-savings measures that are targeted to generate $180 million for the FY2021 are “on track”.
Further details on the status of the cost-saving initiatives were not provided.
ST Engineering says it sees signs of business recovery for its commercial businesses, though the aerospace segment remains subdued as expected.
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The group also highlighted that $1.55 billion new contracts were secured in the 1QFY2021, across commercial aerospace ($573 million), urban solutions and satellite communications ($371 million) and defence and public security ($610 million).
ST Engineering’s order book stood at $15.7 billion as of the 1QFY2021, which it notes is higer than higher pre-Covid order book of $15.4 billion as of end-2020. $4.6 billion is expected to be delivered in the rest of 2021.
For commercial aerospace, the group expects airframe MRO to lead recovery, driven by domestic travel and air cargo demand, while engine and component MRO is anticipated to remain subdued.
The group also referred to its recently announced joint venture with Temasek to capture growing demand for air cargo and dedicated freighters, with a target to build a portfolio valued at about US$600 million ($800 million). ST Engineering intends to securitise in mid-to-long-term to unlock capital.
Shares in ST Engineering closed 5 cents or 1.33% lower at $3.70 on May 11.
