Sembcorp Industries’ net profit crashes 24.7% to $107m

Utilities segment posted weak results.

Uninspiring utilities results have dimmed Sembcorp Industries’ (SCI) net profit in 1Q16. Net earnings fell a staggering 24.7% YoY to $107m during the quarter, while revenue tumbled 18.9% YoY to $1.9b.

According to a report by OCBC, SCI’s utilities segment posted a 7% tumble in turnover to $895m on back of lower high sulphur fuel oil (HSFO) prices in Singapore. This partly offset though, by increased share result from India.

In terms of net profit, the utilities segment saw a 1% uptick to $75.2m in Q1. It was boosted by overseas operations, particularly by China and Middle East operations. On the other hand, SCI’s Singapore power business continued to be impacted by competitive spark threads.

Further, the TPCIL plant in India posted “a small profit” in Q1. OCBC notes that unit 2 of the plant has been down for about a month since early April due to a technical fault as the group decided to take the chance to perform maintenance and repairs originally scheduled in the later part of 2016.

OCBC also asserts that management expects the unit to return to operation in the second half of this month.