ST ENGINEERING’S NET PROFIT GREW 9% IN FY2012

Singapore, 15 February 2013 – Singapore Technologies Engineering Ltd (ST Engineering) today announced that for financial year ended 31 December 2012 (FY2012), Group revenue achieved a new mark to hit $6.38b, a 6% growth year-on-year as all sectors reported higher revenue except for Land Systems sector which registered comparable revenue. Profit before tax (PBT) grew 10% to $723.1m, and Net profit after tax (Net Profit) rose 9% to $576.2m compared to the same period last year.

FY2012 revenues for the Aerospace, Electronics and Marine sectors were $2b, $1.6b and $1b respectively, a growth of between 5% and 15%. Revenue of $1.5b for Land Systems sector was comparable year-on-year.

In the fourth quarter ended 31 December 2012 (4Q2012), revenue contribution from all sectors rose between 6% and 28%, resulting in higher Group revenue of $1.7b, a 12% increase over 3Q2012. Compared to 3Q2012, PBT was comparable at $188.5m.

In the financial year, the Group achieved steady growth in its commercial sales with revenue of $4b, which accounted for 63% of Group revenue, compared to 59% a year ago. Revenue mix from the sectors to the Group remained steady, comprising 32% for Aerospace sector, 25% for Electronics sector, 24% for Land Systems sector and 16% for Marine sector.

These results continue to demonstrate the strength of the Group’s diversified business model, and the strong market positions of the four sectors.

Higher EPS, stronger cash position

Earnings per share (EPS) grew 9% to 18.76 cents, compared to 17.28 cents a year ago. Reflecting the strong cash generating capacity of the business throughout the economic cycle, the Group cash and cash equivalents stood at $2.1b, and advance payments from customers reached $1.7b as of 31 December 2012.

Higher dividend

The Board of Directors proposes a final dividend of 13.80 cents per share, consisting of an Ordinary Dividend of 4 cents per share, and a Special Dividend of 9.80 cents per share. Together with the Interim Dividend of 3 cents per share paid to shareholders in September 2012, this brings the total dividend for the full year to 16.80 cents per share, an increase of 8% over FY2011. This translates to a dividend yield of 5.16%, computed using the average closing share price of the last trading day of 2012 and 2011.

“The Group Revenue grew 6% over FY2011 to $6.38b, with increased revenue from commercial customers contributing 63% of the Group Revenue. PBT improved by 10% and Net Profit grew by 9% respectively. Year-on-Year EBITDA growth of 7% reflected the Group’s continued efforts in developing new capabilities and achieving productivity improvements. The year ended with the Group’s order book at a healthy $12.1b and a stronger cash and cash equivalent balance of $2.1b.

Barring unforeseen circumstances, the Group expects to achieve higher Revenue and PBT in FY2013 compared to FY2012.” ~ TAN Pheng Hock, President & CEO, ST Engineering

ST Engineering expects to deliver $4.3b of the $12.1b order book in 2013, indicating a strong revenue visibility for the Group.

2012 business review

In 2012, all sectors either set new track records or implemented initiatives to further strengthen their market leadership positions.

Aerospace sector introduced new service offerings which include airline interiors, VIP completions, A330 freighter conversion, rotable asset leasing and green engine wash.

Electronics sector made foray into the US and Malaysia through its offerings of rail electronics and intelligent transportation solutions. US subsidiary, iDirect with a 62% market share of its IP hub sales becomes the world’s second largest VSAT system manufacturer.
Marine sector achieved its single largest naval export contract to build four patrol vessels for the Royal Navy of Oman.

Land Systems sector’s TERREX 8×8 Armoured Personnel Carrier was one of only four 8×8 vehicles accepted by the US Marine Corps for the demonstration and studies phase of the Marine Personnel Carrier programme.

In 4Q2012, the Aerospace sector announced $450m worth of new contracts for airframe, component and engine maintenance, as well as engineering and development programmes. This was in addition to the interior modification contract of a Boeing 767-200ER VIP aircraft, and a 10-year component Maintenance-By-the-Hour contract with TransAsia Airways. The Electronics sector announced contracts of about $192m for its rail electronics, intelligent transportation, satellite communications and smart utility projects. Separately, the Land Systems sector secured an evaluation contract to supply a Rescue and Transporter variant of its ExtremV, its new all-terrain tracked emergency vehicle customised for disaster relief and rescue missions, to Japan’s Fire and Disaster Management Agency.