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FY2020 group revenue fell 9% y-o-y to $7.19 billion, mainly due to lower customer demand, supply chain challenges and workforce disruption amid Covid-19, which caused declines across the group’s Aerospace, Electronics and Land Systems sectors. The Aerospace sector, in particular, was impacted the most due to a weak aviation sector on the back of a near-halt in passenger air travel. The lower revenue, says the group, came in line with the revenue guidance posted in its market update for the 3QFY2020. The Aerospace sector reported 21% y-o-y lower earnings at $2.7 billion with 28% lower y-o-y net profit of $192.9 million mainly attributable to lower volume of maintenance, repair and overhaul (MRO) activities, asset impairments and absence of favourable impact of end-of-programme reviews. Excluding support from the government, the group says the sector’s earnings would have remained in the black. In Electronics, revenue came in 2% y-o-y lower at $2.3 billion mainly due to the rescheduling of projects, which were affected by Covid-19. Its net profit grew 11% y-o-y to $203.9 million largely bolstered by cost reduction measures and government support. Land Systems reported 1% lower revenue y-o-y at $1.4 billion due to lower specialty vehicle sales, and offset by higher defence sales. Its net profit stood 31% y-o-y higher due to higher cost savings and government support. Revenue for the Marine sector grew 10% y-o-y to $710 million mainly due to higher contribution from US Shipbuilding, and offset by lower revenue contribution from Singapore. Its net profit fell 45% y-o-y to $28.3 million due largely to a weaker performance from US Shipbuilding and higher operating costs incurred owing to the Covid-19 outbreak. FY2020 profit before tax (PBT) fell 23% y-o-y to $534.4 million due to lower group revenue, the impairment of intangible assets and fair value changes of associates in line with the poorer business outlook for certain lines of businesses due to Covid-19.
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During the year, the group saw cancellations and adjustments of some $1 billion, while certain contracts slated for 4QFY2020 were deferred to January. The group’s order book, which stands at $15.4 billion as at end-December 2020, is slightly higher than its order book at year-end 2019. It says that it expects to deliver some $5.3 billion from the order book in 2021. As at end-December 2020, cash and cash equivalents stood at $729.5 million.
