Earnings from new facilities to buoy Sembcorp Industries despite marine losses

Utility business to contribute 73% of bottomline.

Following the moderation in Marine earnings, DBS now expect utility business to drive Sembcorp Industries (SCI)' revenue.

Marine businesses previously account for 40-60% of the company's bottomline, but DBS now estimates that major contributors in the next two years would be Utilities (73%) and Urban Development (7%).

According to DBS, new facilities will add to SCI’s power generation and water treatment capacities, which should increase earnings assuming that the operations are profitable.

"A total of 3,800MW of power generation capacity, 140 tonnes per hour of steam capacity and 1.3million cubic metres per day of water treatment capacity is expected to be added from now until 2018. This roughly translates to 36%, 3% and 14% increase in power, steam and water treatment capacities respectively," said DBS in a report.