Sembcorp Industries (U96) H1 2024 earnings summary

Executive summary

• Turnover for 1H2024 declined 12% year-over-year to S$3.2 billion, with net profit after exceptional items at S$540 million and adjusted EBITDA at S$1,042 million; interim dividend increased to 6.0 cents per share, up from 5.0 cents last year.

• Lower profitability was mainly due to planned major maintenance of a Singapore gas-fired power plant and lower contributions from Gas and Related Services and Renewables, partially offset by higher land sales in Vietnam and Indonesia.

• Net profit before exceptional items was S$532 million; including exceptional items, net profit was S$540 million.

• Interim dividend of 6.0 cents per share declared, payable August 22, 2024.

Financial highlights

• EBITDA fell 10% year-over-year to S$889 million; adjusted EBITDA down 9% to S$1,042 million.

• Free cash flow increased to S$948 million, mainly due to higher DPN receipts.

• Group ROE before exceptional items annualized at 21%, down from 26.6% last year.

• Net asset value per share increased to S$2.82 from S$2.58 at end-2023.

• Earnings per share (basic) was 30.30 cents, up 2% year-over-year.

Outlook and guidance

• Gas and Related Services earnings expected to improve in 2H2024 after completion of major maintenance.

• Renewables segment earnings likely to be lower in 2H2024 due to seasonality and weak macroeconomy in China, partially offset by new projects.

• Integrated Urban Solutions outlook stable; full-year net profit before exceptional items expected to be stable barring unforeseen circumstances.

• Urban business targets 18,000 hectares of land and 1.5 million sqm of industrial properties by 2028, with >15% net profit CAGR from 2022-2028.