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CSE Q3 net profit down 25% amid struggling oil and gas sector

MAINBOARD-LISTED CSE Global on Wednesday posted a 25 per cent fall in net profit to S$3 million for its third quarter ended Sept 30, down from S$4 million a year ago.

The engineering company attributed this to lower gross margins achieved from the oil and gas sector, and a difficult business and operating environment.

Revenue grew by nearly 6 per cent from S$80.9 million last year to S$85.6 million. CSE Global said that this was due mainly to a 38.6 per cent growth in the Americas region, particularly in the oil and gas sector.

Earnings per share slipped from 0.78 Singapore cent to 0.58 Singapore cent. No interim dividend has been declared for the period.

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CSE Global added that during the quarter, the group continued to secure new orders from both greenfield and brownfield projects totalling S$86.4 million, an increase of 22 per cent from the previous year due to higher flow orders.

As at the end of the quarter, the group's outstanding orders stood at S$207.6 million, only marginally lower than the S$207.9 million recorded last year.

Lim Boon Kheng, group managing director of CSE Global, said: "Given the current economic and the oil and gas industry conditions, CSE expects to report weaker operating performance for the next quarter."

He added that the group is in the midst of reviewing the collectability of its accounts receivables, as well as undertaking a financial review of its business units for the purpose of assessing the fair values of its investments.

Mr Lim said: "Consequently, we expect to report a loss for FY2017 but will remain in a net cash position at the end of the year."