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FiveThings You Should Know About SIA Engineering

Siaec_logoWhile you’ve no doubt heard the name Singapore Airlines (SGX: C6L), its subsidiary, SIA Engineering Company Ltd (SIAEC) (SGX: S59) may not be quite as well-known.

The SIAEC Group is a leading provider of aircraft Maintenance, Repair and Overhaul (MRO) services to more than 80 airlines, worldwide. It also provides line maintenance services to more than 50 international airlines, including Singapore Airlines, which pass through Singapore’s Changi Airport.

But did you know…

  1. In 1997, SIAEC joined forces with Rolls-Royce, to form the International Engine Component Overhaul Pte Ltd (IECO). The company offers a range of aero engine component refurbishment services, specialising in the repair and overhaul of Rolls-Royce Trent engines (utilised by numerous Airbus and Boeing aircraft, including the A380-800).
  2. Rather than recruiting engineers from the open market, SIAEC trains its own at its in-house Training Academy.
  3. The company has won numerous awards, including the Gold Award by Air Transport World in the Maintenance Services Category 2012, and Best MRO by Reeds Exhibition and Asian Aviation magazine at Aviation Awards Asia 2011

SIAEC announced third quarter profits of $67m – which is an increase of 5.5% as compared to the same time last year. And as one of Singapore’s highest yielding shares (4%) it certainly earns a second look from income investors.

Plus the future may be looking bright for SIAEC.

Hong Kong based rival, HAECO (Hong Kong Aircraft Engineering Company) has admitted it was unable to meet the demand in 2012 for airframe maintenance due to a shortage of qualified engineers in the area. Consequently, it expects to carry out less such maintenance work in Hong Kong, this year.

SIAEC, with its in-house trained engineers has suffered no such labour shortages, which could make it a highly attractive alternative.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Alison Hunt doesn’t own shares in any companies mentioned.