ST Engineering: Landed S$1.82B of new contracts in 3Q21 amid strong plane conversions

Singapore five-dollar note Photo by Leslie Shaffer

ST Engineering has landed S$1.82 billion of new contracts in the third quarter, driven in part by strong demand for passenger-to-freight (P2F) conversions of planes, the aerospace and defense company said in a filing to SGX Wednesday.

The total orderbook climbed to more than S$18 billion in the quarter, with S$1.9 billion expected to be delivered by year-end, ST Engineering said.

ST Engineering noted the current semiconductor chip shortage has impacted its internet of things (IoT), satcom and specialty vehicle businesses.

The company’s commercial aerospace division received an order for 18 units of A320/A321 P2F from aircraft lessor BBAM in the July-to-September period, ST Engineering said.

The company added its A330 P2F slots are booked through mid-2025 and the A320/A321 slots are fully booked through mid-2024. ST Engineering said it was in the process of expanding P2F capacity to more sites.

The commercial aerospace division posted S$1.03 billion in new contracts in the third quarter, with jobs including a five-year component maintenance-by-the-hour (MBH) contract from Japan Airlines, a five-year CFM56-7B engine MRO (maintenance, repair and overhaul) contract from Alaska Airlines, and airframe maintenance contracts from an Asian low-cost carrier and an Australia-based airline.

The urban solutions and satcom segment posted S$382 million in new contracts in the quarter, including Singapore rail MRT and LRT jobs, lift-monitoring services in Singapore and satcom ground infrastructure for multiple clients, including USSI Global.

The defence and public security division reported S$413 million in new contracts for the quarter, including munitions for international customers, a naval vessel repair contract for the Royal New Zealand Navy, and cybersecurity products.

Read ST Engineering’s third quarter update.