SINGAPORE (Aug 14): Sembcorp Industries reported earnings of $98 million for the 2Q19 ended June, 20% higher than the earnings of $82 million in 2Q18 a year ago, on improved performance from the Energy business.

Basic earnings per share rose 26% to 4.98 cents from 3.94 cents a year ago.

Turnover in 2Q19 fell 29% to $2.37 billion from $3.3 billion a year ago. Profit from overall operations rose 21% to $232 million.

The Energy business reported an 8% rise in net profit to $92 million, driven mainly by good performance in Southeast Asia (ex-Singapore), China and India.

The Urban business reported a 69% fall in net profit to $11 million with stable contribution from Vietnam and lower contribution from China.

The Marine business saw net loss narrow 82% to $6 million from a loss of $34 million a year ago mainly due to continued lower overall business volume offset by margin recognition from newly secured production floater projects and the delivery of a rig.

In June, Sembcorp also provided a $2 billion subordinated loan facility to Sembcorp Marine to strengthen its financial position.

As at end June, cash and cash equivalents stood at $2.1 billion.

For the 1H19 ended June, Sembcorp reported earnings of $191 million, up from $159 million in 1H18.

Sembcorp’s board of directors has announced an interim dividend of 2 cents per share, which will be paid on Sept 4.

In its outlook statement, Sembcorp says the Energy and Urban businesses continue to underpin the group’s performance. However, the market environment continues to be challenging for the offshore and marine sector and Sembcorp Marine is expecting full year losses.

The group is also evaluating an investment decision to replace one of the combined heat and power facilities on Jurong Island with more efficient technology.

Says CEO Neil McGregor, “We are in the final stages of making a replacement decision on one of our combined heat and power facilities in Singapore to ensure we have a fleet of high efficiency assets to better serve our customers there.”

Shares in Sembcorp closed 1 cent lower at $2.26 on on Wednesday.