SINGAPORE (Jan 25): Keppel Corporation registered a net loss of $495 million in 4Q17 ended Dec, compared to earnings of $143 million in 4Q16.
This was mainly due to the one-off financial penalty arising from Keppel O&M’s global resolution with criminal authorities in the United States, Brazil and Singapore, and related legal, accounting and forensics costs amounting to $619 million.
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Excluding the one-off global resolution and related costs, the group would have attained earnings of $124 million for 4Q17, 13% below that of 4Q16.
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In 4Q17, group revenue of $1.55 billion was 20% lower than the $1.94 billion a year ago.
For FY17, earnings came in at $217 million, 72% lower than the $784 million earnings for FY16. Excluding the one-off financial penalty and related costs, the group would have turned in a net profit $836 million for FY17, or 7% higher than a year ago.
The property division recorded a 10% y-o-y increase in net profit to $685 million, remained the largest contributor to the group’s FY17 net profit. This increase was due mainly to higher fair value gains on investment properties and higher contribution from Singapore and Vietnam property trading and the en-bloc divestment of development projects.
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The infrastructure division saw a 33% increase in net profit to $132 million, due mainly to higher contribution from the energy infrastructure business, the gain on divestment of interests in GE Keppel Energy Services, as well as fair value gain from an investment.
The investments division achieved a net profit of $235 million, representing an increase of over 500% compared to FY16, due mainly to a higher share of profit from the Sino-Singapore Tianjin Eco-City and k1 Ventures, higher contributions from Keppel Capital, gains from the sale of investments and the write-back of provision for impairment of investments.
The offshore & marine division incurred a net loss of $835 million for FY17, compared to a net profit of $29 million for FY16. Besides the financial penalty and related costs, the division saw lower revenue, an additional $81 million provision for losses on the Sete Brasil rig contracts, an impairment of $54 million made to other assets, and lower share of associated companies’ profits.
The group achieved revenue of $5.96 billion for FY17, which was 12% lower than that for FY16.
Keppel's directors have proposed a final cash dividend of 14.0 cents per share for FY17. Including the interim cash dividend of 8.0 cents per share paid to shareholders in August 2017, the total distribution for FY17 will be 22.0 cents per share, compared to the 20.0 cents per share paid out for FY16.
Shares in Keppel closed 5 cents lower at $8.58.
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