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Sembcorp Industries posts 20% rise in Q2 net profit to S$98m

SEMBCORP Industries on Wednesday posted a 20 per cent increase in net profit for the second quarter, as the 33 per cent decline in cost of sales outstripped the 29 per cent reduction in revenue.

The conglomerate announced a net profit of S$98 million for the three months ended June 30, up from S$82 million for the corresponding quarter a year ago. Earnings per share rose 26 per cent to 4.98 Singapore cents from 3.94 Singapore cents consequently.

The bottomline improvement was achieved as Sembcorp Industries reported 29 per cent lower revenue to S$2.37 billion but managed to book a much greater reduction - 33 per cent - in cost of sales.

Its net profit of S$191 million for the first half of the year was an improvement of 20 per cent over S$159 million a year ago, but revenue similarly took a hit and registered a 21 per cent decline to S$4.85 billion.

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Group chief executive officer Neil McGregor said: "This performance was underpinned by our energy business. We continue to make progress in our strategy to reposition the business to become a more sustainable integrated energy player in the global energy transition. Our focus remains on lifting performance, building capabilities and sharpening our competitive edge."

The company has declared an interim dividend of two Singapore cents per share, which will be paid on Sept 4.

"The market environment continues to be challenging for the offshore and marine sector and Sembcorp Marine is expecting full-year losses. While there are downside risks to global economic growth expectations with heightened policy uncertainty and trade tensions, the group's diversified business portfolio is expected to provide resilience to weather the prevailing macroeconomic uncertainties," noted the media statement issued with the financial results.

The counter ended down one Singapore cent at S$2.26 on Wednesday before the results were announced.