Results & Reports

2018 2017#
For the Year (S$ million)    
Turnover 11,689 9,026
Earnings before interest, tax, depreciation and amortisation (EBITDA)1 1,279 1,523
Profit from operations 841 1,084
– Earnings before interest and tax 667 920
– Share of results: Associates & JVs, net of tax 174 164
Profit before tax 420 611
Net profit 347 383
At Year End (S$ million)    
Property, plant and equipment and investment properties 11,672 11,158
Other non-current assets 5,325 4,095
Net current assets 748 2,159
Non-current liabilities (9,807) (9,238)
Net assets 7,938 8,174
Share capital and reserves (including perpetual securities) 6,788 6,944
Non-controlling interests 1,150 1,230
Total equity 7,938 8,174
Per Share    
Earnings (cents) 16.98 19.06
Net assets (S$) 3.80 3.88
Net ordinary dividends (including bonus dividends) (cents) 4.0 5.0
Financial Ratios    
Return on equity (%) 5.1 5.8
Return on total assets (%) 3.6 4.4
Interest cover (times) 2.5 2.9
Total debt-to-capitalisation ratio 0.57 0.55
Total debt-to-capitalisation ratio (less cash and cash equivalents) 0.47 0.40
Footnote

# In accordance with SFRS(I).

For the financial year 2018, Sembcorp Industries has adopted the Singapore Financial Reporting Standards (International) (SFRS(I)) and International Financial Reporting Standards (IFRS) frameworks, as well as the new accounting standards that are effective on January 1, 2018.

SFRS(I) and IFRS are issued by the Accounting Standards Council and the International Accounting Standards Board respectively. SFRS(I) comprises standards and interpretations that are equivalent to IFRS. All references to SFRS(I) and IFRS are referred to as SFRS(I) unless otherwise specified. In addition, 2017 financial figures presented in accordance with SFRS(I) have been stated for comparison against 2018 financial figures, and are marked 2017# in the tables in this section.

The application of SFRS(I) 15 accounting standard to our 2017 financial figures mainly impacted the Marine business. For the Marine business, this has resulted in differences in the timing of revenue and cost of sales recognition for certain contracts. In 2017, when these contracts were terminated and new contracts were entered into, the revenue and related cost of sales were recognised. However, with SFRS(I) 15, the previously recognised revenue and related cost of sales were reversed, and will now be recognised upon the transfer of legal title to customers.

1  EBITDA excludes major non-cash items such as the effects of fair value adjustments, re-measurements, impairments and write-offs.

2018 2017#
GROUP (S$ million)    
TURNOVER
Utilities 6,536 5,697
Marine 4,888 3,035
Urban Development 5 8
Other Businesses 260 286
11,689 9,026
PROFIT FROM OPERATIONS
Utilities 820 650
Marine (60) 350
Urban Development 94 90
Other Businesses 9 21
Corporate (22) (27)
841 1,084
NET PROFIT
Utilities 312 140
Marine (48) 157
Urban Development 86 83
Other Businesses 16 27
Corporate (19) (24)
347 383
UTILITIES (S$ million)    
TURNOVER1
By Geography
Singapore 3,830 3,062
China 219 152
India 1,686 1,592
Rest of Asia 217 453
Middle East & Africa 109 105
UK & the Americas 508 362
TOTAL 6,569 5,726
     
By Product Segment
Energy 5,777 5,005
Water 452 403
On-site Logistics & Solid Waste Management 340 318
TOTAL 6,569 5,726
     
PROFIT FROM OPERATIONS
By Geography
Singapore 224 218
China 103 91
India 385 329
Rest of Asia 39 48
Middle East & Africa 62 61
UK & the Americas 33 34
Corporate (24) (13)
PFO before exceptional items 822 768
Exceptional items (2) (118)
TOTAL 820 650
     
By Product Segment
Energy 614 561
Water 141 148
On-site Logistics & Solid Waste Management 91 72
Corporate (24) (13)
PFO before exceptional items 822 768
Exceptional items (2) (118)
TOTAL 820 650
     
NET PROFIT
By Geography
Singapore 155 163
China 87 78
India 47 (58)
Rest of Asia 22 47
Middle East & Africa 56 55
UK & the Americas 14 27
Corporate (60) (51)
Net Profit before exceptional items 321 261
Exceptional items (9) (121)
TOTAL 312 140
     
By Product Segment
Energy 203 132
Water 102 120
On-site Logistics & Solid Waste Management 76 60
Corporate (60) (51)
Net Profit before exceptional items 321 261
Exceptional items (9) (121)
TOTAL 312 140
MARINE (S$ million)    
TURNOVER
Rigs & Floaters 4,148 1,717
Repairs & Upgrades 476 499
Offshore Platforms 184 732
Other Activities 80 87
TOTAL 4,888 3,035
Footnote

# In accordance with SFRS(I).

1 Turnover figures are before intercompany elimination.

Year Ended December 31 2018 2017#
(S$ million)
Turnover  (Note28) 11,689 9,026
Cost of sales (10,769) (7,791)
Gross profit 920 1,235
General and administrative expenses (408) (420)
Other operating income  107 75
Non-operating income 50 74
Non-operating expenses (2) (44)
Finance income  (Note29) 87 54
Finance costs  (Note29) (508) (527)
Share of results of associates and joint ventures, net of tax 174 164
Profit before tax 420 611
Tax expense  (Note30) (88) (118)
Profit for the year  (Note31) 332 493
     
Profit attributable to:
Owners of the Company 347 383
Non-controlling interests (15) 110
Profit for the year 332 493
     
Earnings per share (cents):  (Note33)
Basic 16.98 19.06
Diluted 16.87 18.89
Footnote

# In accordance with SFRS(I).

The accompanying notes are referenced to the 2018 financial statements and form an integral part of these financial statements.

 

As at December 31 2018 2017#
(S$ million)
Non-current assets
Property, plant and equipment  (Note3) 11,672 11,158
Investment properties  (Note4) 110 91
Associates and joint ventures  (Note6) 1,741 1,765
Other financial assets  (Note7) 262 175
Trade and other receivables  (Note8) 2,349 1,184
Tax recoverable 17 7
Contract costs  (Note15) * 128
Assets held for sale  (Note11) - 100
Intangible assets  (Note12) 779 581
Deferred tax assets  (Note13) 67 64
16,997 15,253
     
Current assets
Inventories  (Note14) 513 524
Trade and other receivables  (Note8) 2,289 2,094
Contract assets (Note9) 1,022 661
Tax recoverable  22 21
Contract costs  (Note15) 329 2,363
Assets held for sale  (Note11) 129 -
Other financial assets  (Note7) 95 142
Cash and cash equivalents  (Note16) 1,925 2,687
6,324 8,492
Total assets 23,321 23,745
     
Current liabilities 
Trade and other payables  (Note17) 2,968 3,340
Contract liabilities  (Note18) 445 1,157
Provisions (Note20) 86 92
Other financial liabilities  (Note21) 62 13
Current tax payable 153 159
Interest-bearing borrowings  (Note23) 1,862 1,572
5,576 6,333
Net current assets  748 2,159
     
Non-current liabilities 
Deferred tax liabilities  (Note13) 425 428
Other long-term payables  (Note17) 237 256
Provisions  (Note20)
163 105
Other financial liabilities  (Note21) 43 54
Retirement benefit obligations  (Note22) 5 4
Interest-bearing borrowings  (Note23) 8,870 8,275
Contract liabilities  (Note18) 64 116
9,807 9,238
Total liabilities  15,383 15,571
Net assets 7,938 8,174
     
Equity attributable to owners of the Company:
Share capital  (Note24) 566 566
Other reserves  (Note25) (248) (85)
Revenue reserve  5,669 5,460
5,987 5,941
Perpetual securities  (Note26) 801 1,003
6,788 6,944
Non-controlling interests  (Note32) 1,150 1,230
Total equity  7,938 8,174
Footnote

The accompanying notes are referenced to the 2018 financial statements and form an integral part of these financial statements.

# In accordance with SFRS(I).

* Less than S$1 million.

 

Year Ended December 31 2018 2017#
(S$ million)
CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the year 332 493
Adjustments for:
Dividend  * *
Finance income  (87) (54)
Finance costs 508 527
Depreciation and amortisation 595 571
Share of results of associates and joint ventures, net of tax (174) (164)
Gain on disposal of property, plant and equipment and other financial assets (8) (20)
(Gain) / Loss on disposal of intangible assets * *
Gain on disposal of joint venture and associate (18) -
Gain on disposal of investment held for sale - (47)
Gain on disposal and liquidation of investments in subsidiaries (11) (5)
Gain on disposal of business (15) -
Changes in fair value of financial instruments (15) 5
Equity settled share-based compensation expenses 11 17
Allowance made for impairment loss in value of assets and assets written off (net) 16 31
Negative goodwill * *
Allowance / (Write-back) of doubtful debts and bad debts (net) 3 (16)
Provision for fines 25 25
Assumption of liabilities on behalf of a joint venture - 11
Impairment of goodwill 1 26
Impairment of investment in associates - 4
Contract costs written back (net) - (20)
Inventories (written back) / written down and allowance for stock obsolescence (net) (1) 10
Tax expense  (Note30) 88 118
Operating profit before working capital changes 1,250 1,512
     
Changes in working capital:
Inventories and work-in-progress (9) 295
Receivables  (Note(c)) (1,216) (810)
Payables (215) (527)
Contract costs 2,160 139
Contract assets (361) (208)
Contract liabilities (748) 320
861 721
Tax paid (122) (70)
Net cash from operating activities 739 651
     
CASH FLOWS FROM INVESTING ACTIVITIES
Dividend received 167 266
Interest received 74 41
Proceeds from disposal of interests in subsidiaries, net of cash disposed of 
73 -
Proceeds from divestment of investment / asset held for sale - 206
Proceeds from sale of property, plant and equipment 11 18
Proceeds from sale of intangible assets * *
Proceeds from disposal of other financial assets and business 315 195
Proceeds from disposal of joint ventures / associates 66 53
Loan repayment from related parties 25 76
Loan to related parties - *
Non-trade balances with related corporations, net of repayment - (16)
Acquisition of subsidiaries, net of cash acquired (426) (3)
Acquisition of additional investments in joint ventures and associates (85) (15)
Acquisition of other financial assets (310) (166)
Purchase of property, plant and equipment and investment properties  (Note(a)) (1,107) (736)
Purchase of intangible assets  (Note(b)) (20) (11)
Net cash used in investing activities (1,217) (92)
     
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from share issued to non-controlling interests of subsidiaries 25 -
Proceeds from share options exercised with issue of treasury shares * -
Proceeds from share options exercised with issue of treasury shares of a subsidiary 1 *
Purchase of treasury shares (17) (4)
Purchase of treasury shares by a subsidiary (1) (6)
Proceeds from issue of perpetual securities, net of transaction costs - 200
Proceeds from borrowings 3,011 3,206
Repayment of borrowings (2,156) (2,427)
Payment on finance leases - (1)
Acquisition of non-controlling interests (292) (10)
Dividends paid to owners of the Company (71) (125)
Dividends paid to non-controlling interests of subsidiaries (29) (37)
Receipt in restricted cash held as collateral 4 6
Perpetual securities distribution paid (245) (42)
Unclaimed dividends * *
Interest paid (486) (484)
Net cash (used in) / from financing activities (256) 276
     
Net increase / (decrease) in cash and cash equivalents (734) 835
Cash and cash equivalents at beginning of the year 2,682 1,855
Effect of exchange rate changes on balances held in foreign currency (25) (8)
Cash and cash equivalents at end of the year  (Note16) 1,923 2,682
Footnote

# In accordance with SFRS(I).

* Less than S$1 million.

a. During the year, the Group acquired property, plant and equipment with an aggregate cost of S$1,146 million (2017:
S$676 million) of which S$nil (2017: S$1 million) relates to non-cash expenditures which have been capitalised during the year and S$4 million (2017: S$21 million) relates to provision for restoration costs as disclosed in Note 20. Included in the Group’s trade and other payables is an amount of S$167 million (2017: S$108 million) relating to accrued capital expenditure.

b. During the year, the Group acquired intangible assets with an aggregate cost of S$20 million (2017: S$13 million) of which S$nil (2017: S$2 million) was acquired by means of finance lease.

c. The increase in receivables included an amount of S$191 million (2017: S$431 million) of service concession receivables from the Myingyan and Sirajganj Unit 4 power projects which was recognised in accordance with SFRS(I) INT 12 accounting guidelines. The receivables will be collected over the period of the concession contracts from the time the power plants commence commercial operations. 

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