ST Engineering's 3Q earnings up 67% to $128.4 mil on absence of one-off charge

ST Engineering's 3Q earnings up 67% to $128.4 mil on absence of one-off charge

By: 
Michelle Zhu
08/11/17, 07:37 am

SINGAPORE (Nov 8): ST Engineering posted a 67% increase in 3Q17 earnings of $128.4 million compared to $76.7 million a year ago due to the absence of a $61.1 million one-off charge incurred in 3Q16 for its Specialty Vehicle business in China.

Group revenue for 3Q ended Sept grew 1% to $1.62 billion from $1.61 billion in the same period last year with higher contributions from the Aerospace and Electronics sectors.

Aerospace revenue grew 8% to $608 million from $563 million with PBT at $66.3 million compared to $65.2 million a year ago.

The growth in revenue from the Aerospace sector was mainly from Component/Engine Repair and Overhaul business group, while Engineering & Materials Services and Aircraft Maintenance & Modification business groups reported comparable revenue.

Revenue for the Electronics sector was 6% higher at $495 million from $466 million, and its PBT was $55.6 million compared to $52.8 million.

The Land Systems sector revenue was $331 million versus $350 million and its PBT was at $15.1 million compared to a loss that resulted from the one-off charge for its Specialty Vehicle business in China in 3Q16. Lower revenue from Automotive and Munitions & Weapon business groups was partially offset by higher revenue from Services, Trading and Others business group.

On the other hand, revenue for the Marine sector dropped 22% to $164 million from $211 million a year ago with lower contributions from across all its business groups.

All in all, quarterly group PBT was up 53% at $162.9 million from $106.6 million previously.

For 3Q17, commercial sales and defence sales constituted 63% and 37% of group revenue, respectively.

ST Engineering ended the quarter with cash and cash equivalents of $1.1 billion after drawing down cash for the payment of a $156 million interim dividend, as well as to fund the $50 million acquisition of robotics company Aethon Inc, and $34 million for marine repair assets in the US.

For 9M17, the group’s net profit grew 9% to $343.4 million from $314.1 million.

Highlighting group’s strong order book of $13.3 billion, of which about $1.2 billion will be delivered in the remaining months of 2017, ST Engineering’s president and CEO Vincent Chong says the group maintains its outlook of comparable revenue and PBT for the year.  

Shares in ST Engineering closed 4 cents lower at $3.47 on Tuesday. 

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