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ST Engineering
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ST Engg
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Joelton
Supreme |
12-Aug-2023 14:03
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ST Engineering H1 net profit gains 0.2%, expects better days ahead on cash savings
ST ENGINEERING : S63 +1.07% reported a net profit of S$280.6 million for the first half ended Jun 30, a marginal 0.2 per cent increase from S$280 million in the corresponding year-ago period. This was in spite of a 13.9 per cent increase in revenue, to S$4.9 billion.
The company&rsquo s earnings were hit by a 177.4 per cent increase in net finance costs, to S$92.8 million. Although finance income grew 300.8 per cent, to S$34.4 million, this was insufficient to offset the 202.4 per cent increase in net income, to S$127.2 million.
ST Engineering is nevertheless optimistic of a better performance in the second half of the year, especially in its Urban Solutions and Satcom arm, which is due to enjoy cash savings of up to S$60 million over the next five years.
Commercial Aerospace was the best performing segment in the first half of the year, as earnings before interest and taxes (Ebit) rose 60 per cent to S$178 million, from S$111 million (excluding a pension restructuring gain in H1 2022).
Including the one-off gain, however, Ebit would have fallen 3 per cent. Revenue grew 32 per cent to reach S$1.9 billion from S$1.4 billion.
The company said it remained confident on growth in the sector, as travel recovers to pre-Covid level, into a &ldquo growth phase&rdquo .
ST Engineering chief executive Vincent Chong reiterated expectations that the group&rsquo s commercial aerospace would recover its pre-Covid level by 2024, on the back of sustained efforts investing in expanding hangar capacity even in the trough of the pandemic.
Meanwhile, its Defence and Public Security arm recorded an Ebit improvement of 41 per cent, from S$214 million last year to S$301 million in H1 2023, due largely to business growth, cost savings, a diverse margin mix and an absence of losses from US Marine. Inclusive of the divestment loss of US Marine, revenue was up 4 per cent, to S$2.1 billion.
The group said the improvement came largely on the back of project deliveries, which are expected to continue through the year. ST Engineering also booked a new order win of S$5.2 billion in the first half of this year.
Its Urban Solutions and Satcom division fared the worst its losses swelled from S$12 million in H1 2022 to S$34 million in H1 2023.
Satcom&rsquo s business worsened in the first half of this year due to supply-chain disruptions &ndash specifically in chip shortages the impact of Covid-19 and a one-off loss of S$24 million on the divestment of SatixFy shares also weighed on the segment&rsquo s bottomline.
However, the company said that, excluding Satcom&rsquo s weakness and the one-off divestment loss, Ebit for the segment would have been S$30 million higher.
ST Engineering&rsquo s earnings per share rose 0.2 per cent to S$0.0901 from S$0.0899.
The directors have approved a second interim dividend of S$0.04 per ordinary share for the quarter ended Jun 30, to be paid out on Sep 1, after book closure on Aug 23. This would take dividends for H1 2023 to S$0.08 per share.
Following a round of &ldquo right-sizing&rdquo , which entailed lowering the headcount in Satcom by 20 per cent, Chong said the company would now enjoy up to S$60 million in cash savings annually, as staff cost savings are ammortised over the next few years.
The company is also focusing its efforts on building a multi-orbit platform for all its Satcom customers, converging its other platforms into one.
Chief financial officer Cedric Foo said that the merging of the platforms would also lead to reduced engineering hours.
It also expects Transcore &ndash a US transportation company acquired in 2022 &ndash to be earnings accretive in 2024, on the back of project deliveries weighted in the second half of this year.
&ldquo We expect 2024 to be stronger than 2023 for Satcom, with the absence of the one-time cost from the divestment of SatixFy shares as well as the strengthening of our base business,&rdquo said Chong. He added that the group will provide an outlook on the segment when the full-year&rsquo s results are in.
He is also setting a target of tripling the company&rsquo s digital business revenue to more than S$500 million by 2026. He added that the company was &ldquo making good progress&rdquo , and that he expects it to outperform the target.
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Startsmm
Member |
11-Aug-2023 08:55
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Very good result, fly high today | ||||
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MichaelSchenker
Master |
11-Aug-2023 07:05
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1H 2023 Financial Results (NB: 31 Pages) https://links.sgx.com/1.0.0/corporate-announcements/1QC4LKUR2WDNZE9W/768571_ST%20Engineering%201H2023%20Results%20Announcement.pdf |
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MichaelSchenker
Master |
11-Aug-2023 06:56
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CD: 4 cents XD: 21 August 2023 Pay Date: 1 September 2023
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MichaelSchenker
Master |
10-Aug-2023 17:51
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Fly... ST Engg fly......! https://links.sgx.com/1.0.0/corporate-announcements/9VG99FC3Y9CPSZEI/768428_20231008_ST%20Engineering%20Announces%20Sale%20of%2011%20Aircraft%20to%20Keystone.pdf |
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MichaelSchenker
Master |
10-Aug-2023 08:59
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Tomorrow we will have a clearer picture when they announce the results. Probably will also announce CD of 4 cents which is quite expected. |
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MichaelSchenker
Master |
05-Aug-2023 14:16
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But.... apparently some big hands are trying to suppress the price. Look at past few trading sessions, whenever the price creeps up, some big hands will just throw it down. Personally, I think it will unlikely cross $4, not even $3.9. But of course that just my view
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Joelton
Supreme |
05-Aug-2023 12:07
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RHB Bank Singapore lifts ST Engineering&rsquo s TP to $4.25 as it expects its strong share price performance to continue
RHB Bank Singapore analyst Shekhar Jaiswal is maintaining his &ldquo buy&rdquo call on Singapore Technologies Engineering (ST Engineering) S63 0.27% as he expects the stock&rsquo s strong share price performance to continue.
The analyst has also raised his target price on ST Engineering to $4.25 from $4.05 previously, noting that the stock&rsquo s share price has risen 10% year-to-date (ytd) and outperformed the benchmark Straits Times Index (STI) by 7%.
Jaiswal&rsquo s new target price represents an upside of 15% to ST Engineering&rsquo s share price of $3.70 as at its close on Aug 2. The new target price, which includes a 6% environmental, social and governance (ESG) premium over the fair value of $4, also represents a yield of 4%.
&ldquo We continue to believe that ST Engineering is positioned to benefit from the revival in global air travel and increased government spending on infrastructure and defence,&rdquo he writes.
In his report dated Aug 3, the analyst continues to view ST Engineering as a &ldquo special investment opportunity&rdquo with strong earnings growth potential and a well-supported defensive yield.
He believes the group&rsquo s FY2023 to FY2025 earnings will be supported by a recovery in global aviation traffic boosting its commercial aerospace (CA) segment, contributions from its TransCore acquisition supporting strong growth for its urban solutions and satcom (USS) segment starting FY2024 and lastly, rising defence spending supporting growth for its defence public security (DPS) segment.
Jaiswal expects the CA segment to deliver 14% ebit CAGR, the USS segment to deliver 64% ebit CAGR, and the DPS segment to deliver 7% ebit CAGR.
&ldquo ST Engineering&rsquo s outstanding orderbook stands at an all-time high of $25.4 billion, providing over two years of revenue visibility,&rdquo he notes.
ST Engineering will be announcing its results for the 1HFY2023 ended June 30 before the market opens on Aug 11.
&ldquo We continue to expect [that] in FY2023 ST Engineering will deliver about 6% growth in revenue to $9.53 billion and around 14% growth in profit to $549 million. In line with management expectations, we believe that project deliveries will be weighted in 2HFY2023, implying that upcoming 1HFY2023 reported numbers could account for less than 50% of our full-year estimates,&rdquo says Jaiswal.
He continues: &ldquo ST Engineering should deliver a 17% profit compound annual growth rate (CAGR) during FY2022 to FY2025 and continue to pay 16 cents of dividends each year thanks to its strong free cash flow (FCF) generation despite elevated debt levels. We make small adjustments of around 1% to our earnings estimates and roll forward our valuation basis to 12-month forward estimates.&rdquo
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cmengchan
Senior |
10-Jul-2023 18:46
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Share Buyback of 500K shares today for $1.7m. I think share price will be well supported. | ||||
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ryancyp
Member |
10-Jul-2023 16:21
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Never heard of any good news for months | ||||
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geographic
Senior |
10-Jul-2023 13:41
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Any reason for reason dropped in price? |
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RedAnt
Member |
23-Jun-2023 08:56
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Did not dig out any bad news. The only news is that they got an enhance version of SAR-21 and a personal carry vehicle to be showcase in Air Show 2024. | ||||
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ryancyp
Member |
22-Jun-2023 14:23
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What happened to ST Engineering? Will it go below $3.60? | ||||
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XiaoFeiXia
Senior |
27-May-2023 07:50
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Will it be like Semcorp Ind? Up after XD...... | ||||
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MichaelSchenker
Master |
22-May-2023 21:26
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XD tomorrow 23.05.2023 Last done: 3.76 Looked like a missed opportunity to Sell. May slide down the slippery slope again. Not cursing this counter, but my gut feel is it will go sub 3.60 soon. Just my opinion only, take it with a pinch of salt.
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Joelton
Supreme |
18-May-2023 10:09
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ST Engineering sets up joint venture with Chinese cargo carrier SF Airlines
SINGAPORE Technologies Engineering : S63 -1.08% (ST Engineering) on Wednesday (May 17) announced that its commercial aerospace business and SF Airlines &ndash a Chinese cargo airline &ndash have incorporated a new joint-venture company in Ezhou, in China&rsquo s Hubei province.
The company will operate a greenfield airframe facility at the Ezhou Huahu Airport to provide airframe maintenance, repair and overhaul (MRO) services to cargo and passenger airlines operating in Asia, including SF Airlines.
The first hangar facility is slated to be ready in 2025, ST Engineering said.
The joint-venture company was set up with a registered capital of 100 million yuan (S$19 million). ST Engineering holds a 60 per cent stake in the company, and SF Airlines, the remaining 40 per cent.
Jeffrey Lam, ST Engineering&rsquo s president of commercial aerospace, said China will be a &ldquo strong growth driver&rdquo for Asia&rsquo s commercial aerospace sector over the next decade.
&ldquo A presence in Hubei, China, will enhance our MRO network in Asia to better meet and capture the rising regional demand, while our strategic collaboration with an airline partner will enable us to start up a greenfield operation quickly,&rdquo he added.
The setup of this joint-venture company is not expected to have a material impact on the consolidated net tangible assets per share and earnings per share of ST Engineering for the current financial year.
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beng1102
Elite |
16-May-2023 21:09
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I think many have sold early due to downgrade by citibank. So it is time to buy back as there should be more upside.
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john_ric
Supreme |
16-May-2023 10:55
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Chance to revisit $4. Is high | ||||
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Joelton
Supreme |
16-May-2023 10:39
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ST Engineering Q1 revenue up 13% to S$2.3 billion on growth in most segments
ST ENGINEERING : S63 -0.82%on Monday (May 15) reported revenue of S$2.3 billion for the first quarter, up 13 per cent from S$2 billion the previous year.
In a business update, the defence and engineering group said its topline growth came as revenue in most business segments booked improvements over the quarter, and from contributions from transportation solutions provider TransCore, which it acquired in 2022.
Its board has approved a Q1 interim dividend of S$0.04 per share, which will be paid out on Jun 6.
Revenue from the urban solutions and satellite communications segment rose 46 per cent to S$434 million from S$297 million the previous year, following higher TransCore project deliveries.
But the segment&rsquo s revenue growth for the first quarter was affected by supply chain disruptions and project delays, the group noted.
Its commercial aerospace business posted a 29 per cent on-year increase in revenue to S$873 million from S$674 million in Q1 2022, attributed to the recovery of the aviation sector as borders reopened.
The group noted that its Q1 2023 revenue for the segment was higher than pre-Covid levels, as air travel recovered to more than 80 per cent of pre-Covid levels in January and February 2023.
Domestic travel reached near full recovery at 97 per cent, while international travel stood at 78 per cent, said the group. As China reopens, ST Engineering expects more growth in its commercial aerospace sector.
The group added that narrow-body aircraft production is expected to be strong over the next 10 years. ST Engineering manufactures nacelles for Airbus&rsquo A320neo fleet, which is projected to see growth. (*see amendment note)
Defence and public security revenue fell 8 per cent to S$982 million, from S$1.1 billion in Q1 2022. Excluding Q1 2022 revenue from the group&rsquo s US marine business, the segment&rsquo s revenue was up 1 per cent from S$968 million.
In November last year, the group proposed to divest all of its US marine subsidiaries &ndash VT Halter Marine and ST Engineering Halter Marine and Offshore &ndash to Bollinger Shipyards Lockport for US$15 million.
The group said a total of S$4.9 billion worth of new contracts was secured over Q1, with defence and public security registering the highest value of deals at S$3.3 billion. Urban solutions and satellite communications won S$823 million worth of contracts, while commercial aerospace won S$747 million worth.
ST Engineering&rsquo s order book stood at S$25.4 billion as at end-March. The group expects S$5.8 billion worth of contracts to be delivered over the rest of 2023.
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MichaelSchenker
Master |
16-May-2023 10:03
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CD: 4 cents for 1Q Year 2023/2024 XD: 23/05/2023 Lat Done: 3.68
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