Sembcorp Industries Q1 profit rises 21% to $93m on improved energy business

SINGAPORE - Sembcorp Industries on Wednesday (May 15) posted a 21 per cent rise in net profit for its fiscal first quarter, on the back of improved performance from its energy business.

For the three months ended March 31, 2019, net profit came in at $93 million, up from $77 million last year.

The results translate to an earnings per share (EPS) of 4.68 cents, versus an EPS of 3.64 cents for the year-ago quarter.

No interim dividend has been declared for Q1 2019, as it is the company's practice to consider declaring dividends on a bi-annual basis, Sembcorp Industries said.

Meanwhile, revenue fell 10 per cent to $2.48 billion from $2.76 billion previously, as turnover from its marine business tumbled 31 per cent to $811 million. This was mainly due to lower revenue recognition from the group's rigs and floaters and offshore platform projects.

In a media statement, Sembcorp Industries CEO Neil McGregor said: "In Q1 2019, our energy business continued to perform well with improved contributions from India and the UK... Order book for the urban business remains healthy, while the marine business faces a challenging market environment. The group continues to make progress on the execution of our strategy and capital recycling plans."

Looking ahead, Sembcorp Industries noted that global economic growth is projected to ease, as markets face escalating risks including rising trade tensions, and tightening financial conditions.

Nonetheless, the group expects its energy business to consolidate and deliver a steady performance this year.

"In Singapore, completion of the sale of certain utilities facilities to ExxonMobil Asia Pacific is expected by end-2019. InIndia, the energy business is expected to continue to improve, underpinned by a positive long-term outlook for the Indiapower market," the company added.

Shares in Sembcorp Industries closed at $2.53 on Tuesday, up 0.4 per cent or one cent.