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SIAEC posts 36.5 per cent drop in net profit for Q4

SIA Engineering Company (SIAEC) reported a drop in net profit from S$65.2 million a year ago to S$41.4 million for the fourth quarter ended March 31, 2015.

Revenue declined 11.3 per cent to S$276 million on the back of lower airframe and component overhaul revenue, while earnings per share came to 3.69 Singapore cents, down from 5.85 cents a year ago.

For the full year, net profit slumped from S$265.7 million to S$183.3 million, while revenue fell 4.9 per cent to S$1.12 billion.

The board is recommending a final dividend of 8.5 Singapore cents per share.

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"The operating environment for the maintenance, repair and overhaul (MRO) industry remains challenging. Advancements in the newer generation engines have improved their reliability while the older generation engines are being phased out. These developments will continue to result in a reduction in engine shop visits in the next few years," it warned.

To better position itself for the future, SIAEC is establishing a fleet management joint venture with plane maker Boeing.

"Given the growth in the operating fleet within the region, the company remains confident that the demand for engine and aircraft MRO work will pick up in the future," it added.