ST Engineering pops the champagne on $780m new orders

These were sealed in 4Q13.

In a release, Singapore Technologies Engineering Ltd (ST Engineering) today announced that its aerospace arm, Singapore Technologies Aerospace Ltd has been awarded new orders worth $780m in the fourth quarter of 2013. These contracts span the aerospace sector’s broad range of capabilities, from airframe, component and engine maintenance, to cabin reconfiguration and engine wash.

Following the launch of the 15-pallet cargo configuration development effort for its 757-200SF freighter conversion programme in June 2013, ST Aerospace received its first contract for five 757-200SF converted freighters with the new variant.

A six-year contract was also secured with an existing Asian customer for the depot maintenance of its fleet of aircraft, covering airframes, components and engines.

ST Aerospace continued to gain momentum as a complete turnkey cabin reconfiguration provider, with the award of a cabin interior modification contract for 20 Boeing 767-300 aircraft. The first aircraft was inducted in early January 2014, targeted for redelivery by end of first quarter 2014.

For VIP cabin reconfiguration, its US affiliate secured its first green aircraft completion contract from an undisclosed European-based VIP Boeing Business Jet customer.

In 4Q2013, ST Aerospace redelivered a total of 198 aircraft for airframe maintenance and modification work. A total of 10,985 components, 67 landing gears and 60 engines were processed, while 2,484 engine washes were conducted for both commercial and military customers.

On airframe capability development, a new narrow-body hangar was added at its Changi facility, capable of accommodating two single-aisle aircraft simultaneously.

In the US, ST Aerospace’s affiliate STA Mobile signed a Memorandum of Understanding with the City of Pensacola to jointly explore the development of a satellite airframe facility at the Pensacola International Airport.

For engine wash, ST Aerospace’s US affiliate EcoServices signed a teaming agreement with Vector-Hawk Aerospace for the launch of a new version of the EcoPower® engine cleansing system, specially developed for all international and domestic customers of commercial and military PT6 turboprop engine-powered aircraft.

On pilot training capability development, additional six Cessna 172 single-engine training aircraft with matching flight training device were acquired for its flying operations in Australia.

Other initiatives implemented in 4Q2013 include the setting up of an aircraft leasing business to focus on mid-life to end-of-life aircraft for leasing, conversion and part out; and the establishment of Hondo Aerospace at the South Texas Regional Airport in Hondo,Texas to venture into green harvesting of aircraft parts, components and engines.

The above developments are not expected to have any material impact on the consolidated net tangible assets per share and earnings per share of ST Engineering for the current financial year.