Group turnover for FY 2005 registered a record high at $2.12 billion, an increase of 55.5% from $1.36 billion in FY 2004. The increase was attributable to growth across all business segments, in particular the offshore conversion and the rig building segments.
Group operating profits saw an increase by 34.0% from $92.9 million in FY 2004 to $124.5 million in FY 2005. Group pre-tax profits recorded an increase by 41.4% from $113.1 million in FY 2004 to $159.9 million in FY 2005. The increase is mainly attributable to better operating profits and contribution from the associated company acquired during the year.
Group tax charge in FY 2005 is higher than FY 2004 mainly due to a $4.2 million write-back of prior years’ tax over-provision, arising from a 2% reduction in corporate income tax rate in FY 2004. Excluding the prior year tax under/(over) provision, Group attributable profits in FY 2005 actually increased 35.7% from $89.9 million in FY 2004 to $122.0 million.
Record Dividend at 9.5 cents per share for FY 2005
In view of the Company’s record performance in FY 2005, the Board of Directors of SembCorp Marine is recommending a final gross dividend of 7.0 cents per share. Together with the interim gross dividend payment of 2.5 cents per share, total gross dividend for FY 2005 will be at a record high at 9.5 cents per share. This is 2.0 cents per share higher than FY 2004. Payout ratio is at 91%.
New contracts secured by the Group in 2005 were at a record high at $4.2 billion with deliveries and completion till 2009. The increase is 102% as compared with the $2.1 billion worth of contracts secured for the year 2004. Total outstanding order book, excluding ship repair, currently stands at $5.9 billion.
Based on the scheduled completion of projects, the Group expects the current year's overall performance to be stronger than FY 2005.
The market outlook for the ship repair sector is expected to be strong amid competitive environment. For the ship conversion and offshore sector, market fundamentals for Floating Production Storage Offloading (FPSO) vessels and Floating Storage Offloading (FSO) vessels will continue to be strong, driven mainly by high oil prices and exploration and production activities.
Rig building demand is also expected to be strong attributed mainly to worldwide high utilization and unprecedented high charter rates.
Overall, market outlook for all sectors in the marine and offshore industry is expected to remain strong.
To download the full PDF version of this report, which includes a breakdown of major rig construction contracts, charts and graphics, please go to http://www.sembcorpmarine.com.sg/scm/invest/FY2005_Results_14feb06.pdf.
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