ASEAN KEY DESTINATIONS
ST Engineering Q2 profit up, sees higher 2007 result
In the past two years, the state-controlled firm has spent over US$500 million buying eight companies worldwide to expand its global reach and to add value to businesses that include the shipbuilding and electronic communication and control equipment for both military and commercial use, Reuters reported.
"The group expects to achieve a higher turnover and profit before tax in 2H 2007 compared to that of 1H 2007, and expects to achieve a higher turnover and profit before tax in full-year 2007 compared to that of full-year 2006," it said in a statement.
ST Engineering , about 50% owned by state investment agency Temasek Holdings [TEM.UL], said in a statement its second-quarter net profit was S$122.8 million ($81 million), up from S$110 million in the year-ago period.
The state-controlled firm said on August 8 that its order book stood at S$9.56 billion at the end of June, down slightly from S$9.7 billion at the end of March.
A Reuters Estimates' poll of 13 analysts showed that ST Engineering was likely to make a net profit of about S$508.8 million in the whole of 2007.
That would represent an increase of about 14% from the S$445.1 million it made in 2006, as a series of acquisitions has increased the firm's capacity to take in more orders and added new sources of income.
The company's aerospace division, which accounts for about a third of revenues, earlier this year won orders from Boeing and Japan's All Nippon Airways for conversion of passenger planes into freighter aircrafts.
Shares in ST Engineering, which has a stock market value of about US$7 billion, rose 8.4% in the April-June quarter and have gained about 17% since the start of the year, outperforming Singapore's Straits Time Index's near-12% rise.
Shares in ST Engineering trade at about 21 times their 2007 forecast earnings, compared with shares of Singapore conglomerates SembCorp Industries and Keppel Corp which trade at around 20 times each. Reuters