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3 Things Investors Should Know About Sembcorp Marine Ltd’s Latest Earnings

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Sembcorp Marine Ltd (SGX: S51) is one of the largest oil rig builders in the world. In late April, the company reported its 2017 first quarter earnings. Let’s take a look at three useful pieces of information that investors may want to know from the announcement:

1. The overall result

Here’s a table showing some important numbers from Sembcorp Marine’s income statement for the first quarters of 2017 and 2016:


Source: Sembcorp Marine 2017 first quarter earnings release

It’s quite clear that the first quarter of 2017 was not a good time for Sembcorp Marine. The company suffered double-digit declines in both revenue and profit.

2. An overview of the order book

The slide below shows Sembcorp Marine’s net order book at the end of 2016 and the end of 2017’s first quarter. The order book is an important metric to track for the company as it represents future revenue.


Source: Sembcorp Marine 2017 first quarter earnings presentation

Compared to the end of 2016, Sembcorp Marine’s order book is currently down by 9% to S$7.14 billion. It’s worth noting that if orders from the bankrupt Sete Brasil are excluded, Sembcorp Marine’s order books at end-2016 and the reporting quarter would be S$4.71 billion and S$4.02 billion, respectively.

New orders secured by Sembcorp Marine in the first quarter of 2017 was S$75 million. In 2016, the company managed to secure S$320 million in orders. These numbers are a far cry from 2013 and 2014, when the company snagged new orders of over S$4 billion in each of those years.

3. Growth in Offshore Platforms business

The table below shows the revenues of Sembcorp Marine’s different businesses in the first quarters of 2017 and 2016:


Source: Sembcorp Marine 2017 first quarter earnings release

Although Sembcorp Marine’s overall revenue performance was poor, there were bright spots in the company’s various businesses. We can see that its Offshore Platforms business grew its revenue by 16% during the reporting quarter.

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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 Lawrence Nga doesn’t own shares in any companies mentioned.