CFA Society Singapore
SINGAPORE (Oct 18): Keppel Corporation reported 3Q18 earnings ended Sept of $226 million, 15% lower than the $265 million for 3Q17. This brings 9M18 earnings to $809 million, 18% higher than the $688 million achieved a year ago.
The weaker third quarter bottomline was mainly due to lower contributions from the investments and property divisions, but offset by stronger performance in the infrastructure and O&M divisions which registered a net profit of $2 million, after losses in the preceding three quarters.
Third quarter group revenue came in at $1.3 billion, 20% lower than the $1.6 billion registered a year ago.
Revenue from the offshore & marine division increased by $36 million to $416 million while revenue from the property division declined by $366 million to $180 million due mainly to lower revenue from Singapore, China and Vietnam property trading.
The division’s net order book, excluding the Sete rigs, stands at $4.4 billion.
The infrastructure division’s revenue grew by $48 million to $674 million as a result of higher sales in the power and gas businesses, partly offset by lower progressive revenue recognition from the Keppel Marina East Desalination Plant project.
Revenue from the investments division decreased by $40 million to $25 million due mainly to the absence of sale of investments as well as lower revenue from the asset management business.
Loh Chin Hua, CEO of Keppel Corporation, says, “Keppel continued to deliver strong results in the first nine months of 2018, during which we announced our expansion into new markets and asset classes such as senior living, early education and Australian retail real estate.
“More recently, we announced our pre-conditional voluntary general offer, together with SPH, to gain majority control of M1 to drive business transformation and enable it to compete more effectively. We have also announced a scheme of arrangement to privatise Keppel Telecommunications & Transportation.
“These are strategic initiatives, which would further expand and enhance the Group’s earnings while positioning Keppel for long-term growth.”
Year to date, shares in Keppel are down 10.2% to close at $6.76 on Thursday.