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Keppel Corp posts 41.5% rise in Q4 earnings to S$191.4m

MAINBOARD-LISTED conglomerate Keppel Corporation reported 41.5 per cent higher net earnings at S$191.4 million for the fourth quarter ended December, on the back of stronger performance from the offshore and marine (O&M), property and investments divisions.

Announcing its results via a statement to the Singapore Exchange on Thursday, Keppel Corp also reported 40 per cent higher earnings per share at 10.5 Singapore cents from 7.5 cents for the year-ago period.

Revenue was S$2.2 billion, up 31.1 per cent year-on-year for Q4, with all except the property division registering higher turnover during the quarter.

For fiscal 2019, it made a net profit of S$707 million, a 25.5 per cent decline from a year ago, when it had benefited from S$584 million gains through en bloc sales of development projects and property divestments.

But its revenue was 27.1 per cent higher at S$7.58 billion, due to higher recognition of ongoing O&M and infrastructure projects, improved sales in the power and gas segment, the consolidation of M1 and higher asset management revenue.

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This was the first time KepCorp's O&M division returned to profitability since 2016. It generated a net profit of S$10 million, reversing a loss of S$109 million a year ago. The industry continues to show signs of recovery. The utilisation and day rates for jackups continue to improve, but it would take some time for these to translate into new orders, given the continuing oversupply in the market.

O&M new order wins were in excess of S$2 billion last year, up 18 per cent compared to 2018. To manage the increased workload, Keppel O&M hired 2,800 additional direct employees, more than it had initially anticipated. In fact, it expects to increase its headcount by a further 1,500 in 2020.

KepCorp has proposed a final dividend of 12 cents per share, which will be paid on May 14 if approved by shareholders.

KepCorp shares closed five Singapore cents or 0.74 per cent lower at S$6.74 on Thursday.

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