Singapore Technologies Engineering (ST Engineering) said in mid-August its net profit for the first half of 2020 fell 4 percent to S$257.4 million as the impact of the COVID-19 pandemic continues to hammer the international aviation industry. The company said group revenue in the first six months was S$3.57 billion, up 2 percent from S$3.51 billion a year ago in the same period. The company’s marine sector revenue performance and acquisitions by the aerospace and electronics sectors in 2019 resulted in revenue growth for the first half but this was offset by the impact of COVID-19 on the aerospace and electronics sectors, which saw revenue fall 7 percent compared to the first half of 2019. Including financial stimulus packages provided by governments in locations where the group’s locally incorporated businesses operate in, the group expects to receive more than S$300 million in government support for full year 2020.
The company said revenue in its aerospace business was up 1 percent year-on-year at S$1.47 billion and the sector’s net profit was down 17 percent year-on-year from S$127 million to S$105 million due to lower volume of work and reduced MRO activities, partly offset by government support.
“We entered the COVID-19 pandemic from a position of strength. Our technology and engineering foundation built up over the years, our strong balance sheet, our diverse business mix and robust order book helped us weather the impact of COVID-19 and maintain even-keel for our first half results,” said Vincent Chong, president and CEO of ST Engineering. “We are cognisant of the ‘tail wind’ afforded us through the various government support schemes (especially the Singapore government’s JSS) for 2020. We do not expect such support beyond this year. We are working to position the group to come out of the pandemic stronger and more competitive. This means focusing on cost reduction, productivity and talent acquisition, organising for growth and serving our customers better. We are also alert to opportunities that have emerged or been accentuated as a result of COVID-19. We are well positioned to benefit from areas like Passenger-to-Freighter conversion and smart city solutions, including safe access control management.”
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