SEMBCORP Industries on Thursday (Feb 27) reported a 14 per cent rise in total net profit to S$471 million for the second half ended Dec 31, 2024, from S$412 million in the year-ago period.
This accounts for exceptional items including disposal of assets and a gain on a “bargain purchase” on an acquisition in India, among others.
There was also a S$9 million net loss from discontinued operations related to the disposal of Chongqing Songzao Sembcorp Electric Power.
Excluding discontinued operation, net profit for the half-year period would have been S$480 million, a 17 per cent increase from S$412 million in the previous corresponding period.
That pointed to earnings per share of S$0.2691, up from S$0.2312 in H2 FY2023.
Sembcorp posted revenue of S$3.2 billion for the current period, down about 5 per cent from S$3.4 billion in the prior year.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
It is also reorganising its business into three segments: gas and related services, renewables and integrated urban solutions. Koh Chiap Khiong will be appointed chief executive officer of gas and related services, including heading the energy transition portfolio in Singapore.
Alex Tan will be appointed CEO of renewables, East, leading the renewables business in China and South-east Asia. Vipul Tuli will be appointed CEO of renewables, West, leading the renewables business in India and the Middle East, as well as Sembcorp’s global hydrogen business and rejuvenation of the UK operations.
Eugene Cheng will be appointed CEO of integrated urban solutions, while retaining his group chief financial officer role. He will oversee the urban and water business.
Wong Kim Yin, CEO of Sembcorp Industries, said: “The idea of having CEOs that align with our business lines is so that each of these discrete business lines now have a strong leader who will help build up the ambition and the strategy towards 2028 and beyond.”
For the full year, net profit rose 7 per cent to S$1.01 billion, from S$942 million in the prior corresponding period. Excluding the exceptional items and net loss from discontinued operations, net profit would be S$1.02 billion, mostly unchanged from that in the year-ago period.
Full-year revenue came in at S$6.4 billion, a decline of around 9 per cent from the S$7.04 billion for FY2023.
It proposed a final dividend per share of S$0.17, subject to shareholders’ approval. This is more than double the S$0.08 declared in the previous period.
Having crossed S$1 billion in net profit for two consecutive years has given Sembcorp the confidence that it can increase and sustain its dividend, said Wong. The change has been prompted by success in the contracting strategy in Singapore, and the company has the largest portfolio of high-quality downstream customers now in Singapore.
“We are gaining the confidence that we can grow or at least sustain it,” he said.
The final dividend will be paid out on May 13. Together with the interim dividend of S$0.06 per share paid out in August, the total dividend for FY2024 is S$0.23 per share, Sembcorp said.
The energy and urban solutions provider attributed its “resilient performance” to strong earnings by its gas and related services segment, as well as its integrated urban solutions division.
“We continued to secure long-term contracts for our Singapore portfolio, enhancing certainty and growing our earnings visibility,” it added.
On Singapore’s exploration of nuclear energy via small modular reactors, Sembcorp would be in a prime position to support any efforts, said Wong. But it will depend on if and when the Singapore government decides to bring it in.
“I can’t see the government awarding the first nuclear plant to a foreign player, and if it is to be a Singapore player, you have less than a handful. Among the less than a handful, who has customers with the confidence to sign up? I feel that we are in the pole position,” he said.
Shares of Sembcorp closed flat at S$5.88 on Wednesday.
