ST Engineering's marine arm hits 6% sales rebound to $179m

Could this mean its exposure to oil and gas now insignificant?

According to DBS Group Research, ST Engineering's exposure to oil and gas are now insignificant after provision for doubtful debt.

The Marine segment posted a 6% QoQ rebound in sales to S$179m, as the US shipbuilding operations saw a q-o-q improvement in sales and profitability.

However, on a y-o-y basis, sales fell by around 16% as challenging macro conditions persists, with profit before tax declining 29% QoQ largely due to allowance for doubtful debts & bad debts written off amounting to almost $13m during the quarter

"However, with this write-off, management indicated that the segment’s net exposure to the oil & gas segment remains “insignificant” – which is positive in our view, as we can hopefully expect less of such one-off items," DBS Group Research said.