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STEng – Lim & Tan
- ST Engineering’s first quarter net profits came at S$134 million, posting a paltry loss of 0.3% y-o-y, which represents 22% of consensus full year forecast.
- The firm’s aerospace sector contributed positively to its bottom-line, with profitability growing 26% y-o-y due to encouraging sales mix, favourable foreign exchange impact and higher profits from associates.
- On the other hand, 1Q ’13 earnings contributions from its Electronics, and Marine sectors were only comparable to that of 1Q ’13, whereas its Land Systems sector profitability was lower (-9% y-o-y), due to unfavourable product mix and allowances for inventory obsolescence and doubtful debts. Absence of contribution from an associate with profit from Singapore Airshow 2012 also hurt performance.
- Nevertheless, its order book grew to S$13.0 billion, up from S$12.1 billion recorded in 4Q ’12.
- Management guided to achieve higher revenue and profits before tax for FY 2013, compared to FY 2012, and deliver S$3.6 billion of its order book within 2013.