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Keppel Corp posts 39% fall in Q2 net profit

KEPPEL Corporation on Thursday posted 39 per cent lower net profit at S$153 million for the second quarter ended June, largely due to absence of gains from en bloc sales of development projects.

In contrast, the conglomerate recorded S$249 million for its bottom line for the year-ago period, it announced in its financial results. Earnings per share, consequently, declined by the same magnitude of 39 per cent to 8.4 Singapore cents from 13.7 Singapore cents in the corresponding quarter a year ago.

The decline in net profit came despite a 17 per cent year-on-year rise in revenue to S$1.78 billion from S$1.52 billion. Except for the Offshore & Marine division, all divisions registered higher revenues during the quarter.

Keppel Corp declared an interim cash dividend of eight cents per share for the first half of financial year 2019, with the dividend payable on Aug 6.

Net asset value per share dipped marginally to S$6.12 as at June 30, compared to S$6.20 (restated) six months ago.

Keppel Corp disclosed that telecommunications unit M1 netted more than 15,000 new customers within a month of launching a simplified plan in May to replace its previous 19 plans. This took M1's base to 2.25 million as at end-June, an increase of about 80,000 customers year-on-year. 

The conglomerate posted a net profit of S$356 million for the first half of FY2019, 39 per cent below the S$586 million achieved a year ago, mainly due to lower contributions from en bloc sales of property projects which amounted to S$416 million in 1H 2018.

Loh Chin Hua, chief executive of Keppel Corp, said in a results briefing webcast that the US-China trade tensions so far have had a limited, direct impact on the conglomerate. If conflicts between the world's two largest economies aggravate, Keppel Corp must be prepared not only to deal with the possible challenges ahead, but to seize opportunities that may arise from these disruptive changes.

Keppel Corp shares ended at S$6.59 on Thursday, down 11 Singapore cents or 1.64 per cent before the results were released.