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Sembcorp Delivers Solid 2Q2011 Performance

August 04, 2011

- 2Q2011 Group Net Profit grew 9% to S$175.1 million

Sembcorp Industries (Sembcorp) achieved a solid 9% increase in net profit attributable to shareholders of the Company (Net Profit) for the second quarter of 2011 (2Q2011). Group Net Profit improved to S$175.1 million from S$161.2 million in 2Q2010, while turnover stood at S$2.2 billion. The Utilities business delivered a strong performance during the quarter. Net Profit grew 30% to S$75.9 million, driven primarily by higher contributions from operations in Singapore, China and Middle East & Africa. Net Profit from the Marine business was S$91.0 million compared to S$107.5 million in 2Q2010.

In 1H2011, Group Net Profit grew 5% to S$335.0 million compared to S$320.1 million in 1H2010 while turnover stood at S$4.2 billion. Return on equity (annualised) for the Group was a healthy 17.0% and earnings per share amounted to 18.8 cents for the period. Economic value added was a positive S$255.9 million, while cash and cash equivalents stood at S$2.2 billion.

Mr Tang Kin Fei, Group President & CEO of Sembcorp Industries, said: “We have delivered a solid set of results in the first half of the year. At the same time, we are developing S$5 billion worth of new projects in Singapore, Oman and India to drive the growth of the Group and we are making good progress in the development of these projects. Furthermore, with the growing demand from industrialisation and urbanisation, Sembcorp is well-positioned in the right businesses and the right markets to capitalise on these opportunities and deliver growth in years to come.”

FY2011 Outlook

The Utilities business is expected to deliver a better performance compared to last year and the Singapore operations will continue to be the main driver. In 4Q2011, the second tranche of gas from West Natuna will start to flow, augmenting existing supply by 26% or 90 Bbtu. Operations in other regions are also generally expected to perform satisfactorily, with the exception of UK which continues to be impacted by very low power spreads.

Our Marine business has a current net orderbook of S$5.7 billion, with completions and deliveries till 2014, including S$2.6 billion worth of new contracts secured year-to-date. Fundamentally, growth drivers of the offshore oil industry remain intact with the expected increase in spending by oil majors and national oil companies in 2011. Demand for premium jack-up rigs is expected to continue, while growth is anticipated in the deepwater segment. Similarly, global outlook remains positive in the fixed and floating production market while the ship repair market continues to strengthen with continued demand for bigger docks.

Industrial Parks 
In Vietnam, we have total land commitments of 314 hectares and it remains an attractive destination for manufacturing companies due to its access to the IndoChina market as well as an alternative manufacturing base to China. We continue to see good interest for our projects in Binh Duong, Bac Ninh and Hai Phong, in spite of tighter fiscal and monetary policies to rein in inflation. Overall, contribution from Industrial Parks is expected to be satisfactory.

In the context of an increasingly uncertain global economic outlook, the Group remains firm in its commitment to deliver long term growth through focused execution in our existing businesses and pipeline projects as well as through the active pursuit of new growth opportunities.

Highlights from Sembcorp’s 1H2011 Financial Results

  • Solid 1H2011 performance
    • Turnover at S$4.2 billion
    • Profit from Operations* at S$570.7 million, up 3%
    • Net Profit at S$335.0 million, up 5%
    • EPS at 18.8 cents
    • ROE (annualised) at 17.0%
  • Good progress in the development of major growth projects

*Profit from Operations = Earnings before Interest and Tax + Share of Associates’ and JVs’ results (net of tax).

- END -

For analysts’ and media queries please contact:

Melissa Yee (Ms)
Group Corporate Relations
DID: +65 6723 3326
Email: [email protected]

Aleve Co (Ms)
Group Corporate Relations
DID: +65 6723 3178
Email: [email protected]


Sembcorp Industries is a leading energy, water and marine group operating across six continents worldwide. With facilities with 5,600 megawatts of gross power capacity and over six million cubic metres of water per day in operation and under development, Sembcorp is a trusted provider of essential energy and water solutions to both industrial and municipal customers. It is also a world leader in marine and offshore engineering, as well as an established developer of integrated townships and industrial parks.

The Group has total assets of over S$10 billion and employs over 9,000 employees. Listed on the main board of the Singapore Exchange, it is a component stock of the Straits Times Index and several MSCI indices.

Note to Editors:
Following a company rebrand, please refer to the company as “Sembcorp” (with “S” in upper case and “c” in lower case), or “Sembcorp Industries” in full. Please also note that “Sembcorp” is not an abbreviation of “Sembawang Corporation” but a brand name in itself, and it is therefore incorrect to refer to our company as “Sembawang”, “Sembawang Corporation” or similar.