Keppel Corp reports net profit for first 9 months, says all divisions performing well

Keppel Corporation's turnover and net profit for the third quarter "grew strongly" from last year thanks to higher contributions from all four key segments. PHOTO: KEPPEL CORP

SINGAPORE - Keppel Corporation's net profit for the first nine months of the year was a "sharp reversal" from the net loss recorded in the same period last year, with all business segments performing better, the firm said on Thursday (Oct 28).

The voluntary business update it released also noted that revenue for the nine months to Sept 30 rose 14 per cent from a year earlier to $5.5 billion. However, it did not disclose earnings for the period.

Keppel added that turnover and net profit for the third quarter "grew strongly" from last year thanks to higher contributions from all four key segments - energy and environment, urban development, asset management and connectivity.

Chief executive Loh Chin Hua said earnings improved compared to levels last seen in 2019, before the pandemic, excluding revaluations, impairments and divestments.

He added that Keppel has divested assets worth $2.4 billion, with $1.6 billion received in cash, and is "on track to exceed" its target of offloading $5 billion in such assets by the end of 2023.

Mr Loh said: "The substantial capital unlocked from our asset monetisation programme would allow us to fuel Keppel's organic and inorganic growth plans, especially in areas such as renewables and decarbonisation solutions, and also reward shareholders for their continued confidence in the company despite the challenging macro environment."

Keppel said discussions on the proposed combination of Keppel Offshore & Marine (Keppel O&M) and Sembcorp Marine are "progressing steadily", adding that rising oil prices are behind signs of improvement in the jack-up rig market.

Keppel O&M has also been receiving more enquiries on bare-boat charters for its rig assets. Its order book stood at $5.5 billion as at Sept 30, up 67 per cent from the $3.3 billion as at Dec 31. Keppel O&M delivered five major projects without loss-time incidents in the third quarter and reduced overheads by over $90 million.

Keppel announced the proposed acquisition of Singapore Press Holdings, excluding the media business during the third quarter.

The company said approvals have been obtained from the Monetary Authority of Singapore and Australia's Foreign Investment Review Board for the proposed SPH ex-media transaction.

This now awaits Keppel and SPH shareholder approvals, court backing for the scheme and the completion of SPH's media divestment exercise.

Keppel and SPH shareholder meetings to seek approval for the proposed transaction are expected next month.

Keppel proposed in August to acquire SPH through a privatisation offer after the hiving off of SPH's media business. The offer involves SPH delisting and becoming a wholly owned subsidiary of Keppel.

SPH shareholders will receive 66.8 cents in cash per share as well as 0.596 Keppel Reit units and 0.782 SPH Reit units per share.

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