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6 Must-Read Quotes From Sembcorp Industries Limited’s Management on Its Strategic Business Review

Sembcorp Industries Limited  (SGX: U96) has a new chief executive officer. His name is Neil McGregor and he took over the reins on 1 April 2017.

One of McGregor’s first moves as CEO was to review Sembcorp Industries’ businesses and strategic direction. The review is expected to take six months. During Sembcorp Industries’ 2017 first quarter earnings briefing, important thoughts on the review process were shared by management. Here’re six quotes investors may not want to miss.

For the first three quotes, you can head here.

Three key strategic factors

For the review, McGregor has his eyes on three main factors: performance, sustainability, and value creation. In the earnings briefing, he gave more insight on each factor:

“A sharp focus on performance is key. We need to focus on cost discipline and strengthening operations.

Secondly, sustainability. As we reshape Sembcorp, we continue to build businesses that are durable and sustainable. We need to take a rigorous approach that not only looks at the opportunities that we have today, but also looks ahead to those that we’re likely to face tomorrow, so that we can maximize risk-adjusted returns for the long term.

Our ultimate objective? Value creation. First and foremost, for our shareholders, but also for our employees, our customers and partners and communities which we operate in.”

The outcome of the review might take another six months, but these are the factors that McGregor will focus on.

This is not a U-turn

McGregor was asked on whether Sembcorp Industries will be pursuing new businesses or remaining within its current operational scope. He responded by saying:

“… this review is not a U-turn.

This review is more about can we build a better business model given the trends and the macroeconomic environment. The fact that disruption is occurring in most businesses and the energy business or power business is no different.”

McGregor added that it was important to anticipate what will happen three to five years down the road. He added that Sembcorp Industries will be looking at countries where it already has a presence in and possibly, some countries where it does not have a presence yet.

Sembcorp Industries will be looking for the “most bang for its buck” for its capital investments.

It’s a regular review, folks! 

Sembcorp Industries’ chief financial officer, Koh Chiap Khiong, also highlighted another key point. While the review seems like a big one, the company does strategic planning and reviews almost every year. Koh said:

“Actually, the Group does strategic planning and review almost yearly, sometimes with external agencies, sometimes with our own current resources but we do look at it on a regular basis.

I think — and I think you know Mr. Tang [ex-CEO of SembCorp Industries] has been with the Company for many years, so Neil just joined. So of course, with a new CEO, I think a new perspective been brought in so I think give us a chance to look at the whole new things again and we can come back. It’s not that we have never been doing anything and then suddenly we are doing a big review.”

Investors will have to wait for the review to be concluded before any conclusions can be drawn.

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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 Chin Hui Leong doesn’t own shares in any companies mentioned.