SIAEC's Q2 net profit falls 20.2% to $35.5m

For the first half, gains from the divestment of associates pushed net profits at SIA Engineering up more than 172 per cent to $233.9 million. Among the contributions was a $141.6 million gain in the first quarter from the sale of its stake in Hong K
For the first half, gains from the divestment of associates pushed net profits at SIA Engineering up more than 172 per cent to $233.9 million. Among the contributions was a $141.6 million gain in the first quarter from the sale of its stake in Hong Kong Aero Engine Services.ST FILE PHOTO

Aircraft maintenance firm says it will pursue greater efficiencies amid tough outlook for industry

Net profits at aircraft maintenance firm SIA Engineering slid 20.2 per cent to $35.5 million for the second quarter ended Sept 30.

Earnings for the same three months last year were boosted by gains from associated firms.

At the operating level, profits fell by 9.3 per cent to $24.5 million.

Revenues dipped 0.5 per cent to $264.8 million while expenditure rose 0.5 per cent to $240.3 million.

This was mainly due to increases in material and staff costs, which were offset in part by lower subcontract costs, the firm said.

For the first half, net profits soared more than 172 per cent to $233.9 million, on the back of gains from the divestment of associates.

  • AT A GLANCE

    REVENUE: $264.8 million (-0.5%)

    NET PROFIT: $35.5 million (-20.2%)

    DIVIDEND PER SHARE: 4 cents (-33.3%)

During the first quarter, the group made a $141.6 million gain from the sale of its 10 per cent stake in Hong Kong Aero Engine Services to Rolls-Royce Overseas Holdings and Hong Kong Aircraft Engineering Company.

SIAEC also received a special dividend of $36.4 million from the divestment of its 20 per cent stake in Singapore Aero Engine Services to Rolls-Royce Singapore.

This brought the overall gains from divestments to $178 million.

At the operating level, profits in the first half fell 52.2 per cent to $22.9 million.

Revenue for the first six months of the current financial year was $536.4 million, down 1.3 per cent from the previous year.

Expenditure rose by 3.7 per cent to $513.5 million.

The firm has declared an interim dividend of four cents per share.

Earnings per share was 3.17 cents for the second quarter, down from 3.96 cents a year earlier. Net asset value per share was $1.33 as at Sept 30, up from $1.32 as at March 31.

In the face of global economic uncertainties and the challenging outlook of the aircraft maintenance, repair and overhaul industry, SIAEC will continue to restructure and streamline operations to enhance operating efficiencies, the firm said.

SIAEC will also pursue strategic partnerships and undertake initiatives to strengthen its competitiveness for long-term growth, including investing in new technologies and advancing innovation, it added.

The company's shares rose one cent to $3.70 before the announcement of the results.

A version of this article appeared in the print edition of The Straits Times on November 02, 2016, with the headline 'SIAEC's Q2 net profit falls 20.2% to $35.5m'. Print Edition | Subscribe