Net profit of 262 million Singapore dollars came in below analysts' forecasts. Revenue totalled 2.2 billion dollars in the three months to March, up 9.0 per cent from the same period last year, the company said.

Revenue and earnings from the offshore and marine division, which covers the oil rigs business as well as ship conversion, ship building and repairs, fell during the quarter.

Keppel said however its project pipeline remained healthy after it secured 664 million dollars worth of new orders in the first three months of the year.

As of end March, its net order book amounted to 11.8 billion dollars, with deliveries extending into 2011.

The offshore and marine division accounted for 60 per cent of net profit during the quarter.

'Our customer base is made up largely of established operators, including US drillers and national oil companies,' Keppel said.

The company's property, infrastructure and investments divisions reported double-digit increases in net profit to offset the drop in the offshore and marine unit.

Keppel said it secured eight housing projects in Vietnam last year, and plans more development launches this year in China, Vietnam, India and the Middle East.

A robust office market in Singapore, supported by strong demand from financial institutions seeking to expand their regional offices, helped boost Keppel's property business, which contributed 15 percent to the net profit.

'Today's volatile global environment entails various uncertainties and challenges,' it said, adding however that demand remains high for rigs and related equipment due to continued spending on oil and gas exploration and production.

World oil prices are within sight of 120 dollars a barrel amid strong global demand.

Keppel Corp shares fell 0.32 to 11.66 dollars on Thursday. -- AFP