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Highlights of the First Quarter Results at Sembcorp Industries Limited

SembcorpIndustriesLogoSembcorp Industries (SGX: U96), a leading energy, water and marine conglomerate, released its first quarter results on Tuesday. The firm is also a component of the local stock market bellwether, Straits Times Index (SGX: ^STI).

Sembcorp operates in four business segments – Utilities, Marine, Urban Development and Other Businesses.

Revenue for the quarter went up 11.8% year-on-year to S$2.6 billion from S$2.4 billion mainly due to good performance from the Marine sector. Turnover at the Marine sector, which is represented by Sembcorp Marine (SGX: S51), surged 27% to S$1.3 billion.

Net profit increased 4.5% to S$184.8 million from S$176.9 million. The biggest net profit grower was the Urban Development segment which achieved a profit growth of 192% to S$19.5 million, due to strong contribution from its Nanjing Eco Hi-tech Island project in China. Sembcorp’s main profit contributors continued to be its Utilities and Marine businesses, which accounted for 47% and 39% of net profit respectively.

As for the balance sheet, as of 31st March 2014, cash balance was at S$2.9 billion while total borrowing stood at S$2.1 billion.

Tang Kin Fei, Group President & Chief Executive Officer of Sembcorp Industries, said, “In 1Q2014, Sembcorp continued to deliver profit growth, underpinned by better performance from our China operations in both our Utilities and Urban Development businesses. Going forward, our strong pipeline of projects which will increase our power capacity by more than 70% and our water and wastewater treatment capacity by more than 20% over the next three years will enhance our recurring income base. Together with strong Marine and Urban Development orderbooks, Sembcorp continues to be well-positioned to deliver sustainable long-term growth.”

Sembcorp shares closed at S$5.38 on Tuesday, valuing the conglomerate at 12 times its historical earnings. Its dividend yield stands at 2.9%.