ST Engineering’s net profit slides 10% as costs rise and sales drop in Q2

All profits fell except for electronics.

ST Engineering reported disappointing Q2 results this morning, as its net profit fell 10% to $133.2m while revenue fell 0.7% to $1586.4m.

In spite of this, the company still reported a higher interim dividend of S$0.04/share, versus S$0.03 a year ago.

Profits for all sectors except for electronics fell. . Profit before tax for the Aerospace sector was 9% lower at $72.9m, Land Systems sector was 46% lower at $18.2m and Marine sector was 31% lower at $24.7m. PBT for the Electronics sector was comparable at $48.2m.

The drop in revenue was mainly attributed to fewer deliveries in the Automotive segment, while Aerospace, Electronics and Marine registered growth of between 6% and 12% year-on-year.

According to OCBC, “1H revenue eased 0.1% to S$3138.2m, meeting 44.7% of our full-year estimate, while net profit of S$270.4m (down 4.1%) met 43.1% of our FY14 forecast. STE declared a higher interim dividend of S$0.04/share, versus S$0.03 a year ago. Going forward, management expects to achieve higher revenue and PBT in 2H14. While STE expects FY14 revenue and PBT to be comparable to that of FY13, it was down from its earlier guidance of higher revenue and PBT for this year."