ST Engineering's FY2015 net profit slips 0.5%, expects comparable 2016 pre-tax profit

Singapore Technologies Engineering (ST Engineering) reported on Friday that its net profit for the year ended December 31, 2015 slipped 0.5 per cent to S$529.0 million, from about S$532 million in 2014.

Revenue fell 3.1 per cent to S$6.3 billion, from S$6.5 billion. Contributions from its marine sector was lower, but electronics was higher. Aerospace and land systems sectors reported comparable revenue.

"Strong performance from the electronics sector, as well as the stronger US dollar, cushioned the weak results from our shipbuilding business,'' Tan Pheng Hock, ST Engineering's President and chief executive officer, said.

The group ended the year with an order book of S$11.7 billion. Its cash and cash equivalents including funds under management was S$1.4 billion.

Looking ahead, the group expects its revenue for 2016 to be higher, but its pre-tax profit to be comparable to 2015, Mr Tan said. Its pre-tax profit was at S$630.3 million in 2015, down 3.1 per cent from S$650.7 million in 2014.

For 2016, ST Engineering expects higher revenue and a comparable pre-tax profit from its aerospace and electronics sectors. In 2015, aerospace generated S$2.1 billion in revenue and S$290.6 million in pre-tax profit.

For land systems sector, 2016 revenue is expected to be comparable, while pre-tax profit is expected to be lower than 2015. In 2015, the division generated S$1.4 billion in revenue and S$65 million in pre-tax profit.

As for its marine sector, 2016 revenue is expected to be higher, while pre-tax profit is expected to be lower. In 2015, the division generated S$958.4 million in revenue and S$88.3 million in pre-tax profit.

A final dividend of 10.0 Singapore cents a share has been recommended for 2015, comprising an ordinary dividend of 5.0 Singapore cents a share and a special dividend of 5.0 cents a share. ST Engineering paid a 5 cents interim dividend in Sept 2015, making the total dividend payout of 15 cents for FY 2105. In 2014, it paid a final dividend of 4.0 Singapore cents a share and a special dividend of 7.0 cents a share.