SembCorp Q2 profit up

  • AseanPlus News
  • Wednesday, 13 Aug 2003

SEMBCORP Industries Ltd, Singapore's fifth biggest conglomerate, has posted a better-than-expected profit increase for the second quarter on higher gas and electricity sales and gains from the disposal of a China investment company. 

For the April-June quarter, SembCorp made a net profit of S$117.6mil, up 86% from S$63.38mil in the year-ago period. Revenue rose 11.4% to S$1.16bil.  

The 58% state-owned company said it expected a better performance this year than in 2002, revising a profit warning it had given in May amid the SARS outbreak.  

“Our five key businesses now constitute 95% of our turnover. These businesses will be the main drivers of growth in the future,” said group deputy chairman and chief executive Wong Kok Siew.  

The five core divisions are utilities, engineering and construction, logistics, and marine and environmental engineering. 

The group’s overall order book at the end of the half-year stood at S$4bil. 

SembCorp, which imports natural gas from Indonesia via an undersea pipeline for sale and also for its own 800 megawatt power plant, said its energy operations were now profitable. 

Tang Kin Fei, president and chief executive officer of SembCorp’s utilities division, said the overseas power business would drive the unit’s earnings in the future as its Singapore plant was operating at maximum capacity. 

He said SembCorp had invested in power plants to produce some 1,500MW overseas such as in China and Vietnam that would start operations next year. 

SembCorp said it booked exceptional gains of S$66.9mil in the latest quarter from the sale of China investment firm, Cathay International Water. 

The group's other interests include a 64% stake in SembCorp Marine Ltd, South-East Asia’s biggest shipyard, and 61.7% of SembCorp Logistics Ltd.  

The marine unit, which competes with Keppel Corp Ltd among others for shipbuilding, repair and conversion contracts, posted a second-quarter net profit of S$21.6mil, down 8.4% from the same period last year. 

However, the logistics arm, the largest in the region, posted a 32% rise in quarterly profit to S$25.98mil. – Reuters  

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