Sembcorp Marine suffers 29% sink in earnings

It is a disaster.

According to a release, Sembcorp Marine recorded a net profit of $371 million for the first nine months of 2012. This was 29% lower as compared with $523 million for the same period in 2011.

On a quarterly basis, 3Q 2012 net profit was $116 million on the back of lower turnover at $892 million, attributable mainly to lower revenue and margin recognition.

Overall, 9M 2012 Group turnover was $3,052 million, 3% higher as compared with $2,963 million for the same period in 2011.

For the rig building sector, turnover in 3Q 2012 at $428 million was 52% lower as compared with $884 million in 2011. The period saw one jack-up rig, the 3rd jack-up from Noble, achieve initial percentage of completion revenue recognition as compared with 2011 which saw the resumption of revenue recognition for one semi-submersible unit, the Songa Eclipse, upon its completion and delivery in 3Q 2011.

On a nine month basis, turnover at $1,486 million in 2012 was 7% lower as compared with the same period in 2011.

The ship conversion/offshore sector in 3Q 2012 registered a 29% increase in turnover to $300 million as compared with $232 million for the same period in 2011.

The sector saw one project, the conversion of FSO Banyu Urip, achieving major revenue recognition with six other projects in varying stages of construction and five units in the planning stage. On a 9M 2012 basis, turnover was 26% higher at $1,065 million as compared with $847 million in 2011.

For the ship repair sector, turnover in 3Q 2012 was $153 million, 13% lower as compared with $175 million for the corresponding period in 2011, attributable to
timing of ship repair projects. For 9M 2012, turnover was $474 million as compared with $485 million for same period in 2011.

Group operating profit in 3Q 2012 at $126 million was 40% lower as compared with $211 million for the same period in 2011. The third quarter of 2012 witnessed one unit of jack-up rig achieve initial recognition as compared with the same period in 2011 which saw the resumption of revenue and margin recognition of a semi-submersible rig, the Songa Eclipse, upon its completion and delivery in 3Q 2011.

At 9M 2012, operating profit was $406 million versus $536 million in 2011.

On a pre-tax level, Group profit at $139 million in 3Q 2012 was 49% lower as compared with $275 million for the same period in 2011. For 9M 2012, it was $467 million as compared with $637 million in 2011.

Earnings per share for the Group were 17.81 cents with Return on equity at 21.1%.