Sembcorp Marine profit down 8% to $300.4mn

The company’s rig building sector suffered the steepest decline at 56%.

Sembcorp Marine achieved a net profit of $300.4 million for the half year ended 30 June 2011. This was 8% lower as compared with $324.9 million for the corresponding period in 2010, attributable mainly to the timing in recognition of the new rig building projects that were secured since 4Q 2010.

Group turnover at $1,660.2 million was 32% lower as compared with $2,457.3 million in 1H 2010. The lower turnover was due to the timing in recognition of projects, in particular the rig building sector which saw a 56% decline in turnover as new jack-up rigs secured since the fourth quarter of last year are still in the planning stage. In comparison, the corresponding period in 2010 saw more turnkey semi-submersible rig building projects and the resumption of revenue recognition on the completion and delivery of PetroRig III.

The lower rig building turnover was however partially offset by higher contributions from the ship conversion/offshore and ship repair sectors which saw turnover increasing 19% and 4% respectively in 1H 2011 as compared with the same period in 2010. A record total of nine units of FPSOs, fixed platforms and offshore projects, with eight units expected to be delivered within the year, are in different stages of construction. Three such units achieved the initial 20% physical completion and accounted for the higher turnover in 1H 2011.

The ship repair sector saw a total of 130 vessels repaired with the average value per vessel increasing from $2.14 million in 1H 2011 to $2.38 million for the corresponding period in 2010, according to a Sembcorp Marine report.

Group operating profit level as at 1H 2011 was $324.9 million and this was 10% lower as compared with $361.9 million in 1H 2010. At pre-tax level, Group profit at $361.4 million was 12% down as compared with $409.7 million in 1H 2010.