ST Engineering reports 3Q18 net profit rose 5 percent on higher aerospace revenue

ST Engineering reported on Wednesday that its third quarter net profit rose 5 percent on-year to S$134.6 million amid higher revenue from the aerospace and land-systems segments.

Revenue for the quarter ended 30 September rose 1 percent on-year to S$1.63 billion, it said in a filing to SGX before the market open on Wednesday.

In the aerospace segment, revenue increased 13 percent on-year to S$689 million, while net profit rose 13 percent to S$55.4 million on broad-based growth, ST Engineering said.

Electronics segment revenue was up 2 percent on-year at S$491 million in the quarter on higher revenue recognition form its large-scale systems group and the communication and sensors systems group, while the segment’s net profit rose 30 percent on-year to S$55.5 million, mainly on lower operating expenses, it said.

The land-systems segment saw revenue fall 10 percent on-year to S$297 million, but net profit increased 45 percent on-year to S$17.6 million on a favorable sales mix, ST Engineering said.

The marine segment posted a 16 percent drop in revenue in the quarter to S$137 million, while its net profit fell 35 percent on-year to S$12.8 million, it said.

Vincent Chong, ST Engineering’s president and CEO, was upbeat on the outlook.

“A key highlight of the third quarter was our proposed acquisition of MRAS. This business will help scale up our aerospace capabilities by moving us upstream into the OEM business of high-value components. We are excited by the role it will play in the growth of our Aerospace
sector, and look forward to closing the transaction in the first quarter of 2019,” he said.

“We continue to be well placed to deliver long-term sustainable growth. Our innovative and differentiated Smart City solutions are gaining traction outside of our traditional markets as more cities embrace technology for development and modernisation. Our robust order book of S$13.3 billion continues to provide a strong revenue pipeline,” he added.