Sembcorp Marine posts 1Q 2019 net profit of S$2 million

Singapore’s Sembcorp Marine reported net profit of S$2 million (US$1.47 million) for the three months ended March 31, 2019 (1Q 2019), compared with net profit of S$2 million (US$3.81 million) for 1Q 2018.

In 1Q 2019, group revenue totaled S$811 million (US$595 million), compared with S$1.18 billion (US$900 million) booked in 1Q 2018. The revenue decline in 1Q 2019 was largely due to lower revenue from rigs and floaters and offshore platform projects, partially offset by higher revenue from repairs and upgrades.

Excluding the effects of the delivery of 1Q 2019 of one jack-up rig to Borr Drilling, and deliveries in 1Q 2018 of two jack-up rigs to Borr Drilling and one jack-up rig to BOTL, group revenue in 1Q 2019 would have been S$608 million (US$446 million), an increase of 27 per cent compared with S$480 million (US$366 million) in 1Q 2018.

Sembcorp’s operating profit was S$7 million (US$5.14 million), compared with S$20 million (US$15 million) in 1Q 2018, and included accelerated depreciation of S$12 million (US$9 million) arising from the group’s transformation and yard consolidation strategy, wherein all operations at its Tanjong Kling Yard (TKY) will cease by end 2019.

The group claims moving operations out of TKY will realise cost savings estimated at S$48 million (US$35 million) per annum from FY 2020 onwards.