Singapore Technologies Engineering (S63) H2 2024 earnings summary

Executive summary

• Achieved record FY2024 results with 12% revenue growth to SGD 11.3 billion and 20% net profit growth to SGD 702 million, driven by robust execution and strong performance across all segments.

• Order book reached a record SGD 28.5 billion as of 31 Dec 2024, with SGD 8.8 billion scheduled for delivery in 2025, providing strong revenue visibility.

• All business segments contributed to growth, with notable contract wins and continued investment in productivity.

• Productivity improvements and cost savings led to the lowest OpEx/revenue ratio in recent years at 10.6%.

• Total dividend for 2024 proposed at SGD 0.17 per share, up from SGD 0.16 in prior years, reflecting improved profitability.

Financial highlights

• Revenue grew 12% year-over-year to SGD 11.3 billion; EBITDA up 11% to SGD 1.6 billion; EBIT up 18% to SGD 1.1 billion; net profit up 20% to SGD 702 million.

• Net cash from operating activities increased to SGD 1.7 billion, with cash and cash equivalents at SGD 602 million at year-end.

• Gross debt reduced by 5% to SGD 5.8 billion; gross debt/EBITDA leverage improved from 4.2x to 3.6x.

• Weighted average borrowing cost held at 3.6%.

Outlook and guidance

• Confident in continued revenue growth, underpinned by a robust order book and competitive market position.

• Expect Commercial Aerospace growth to outpace industry averages in the midterm.

• 2025 order book delivery guidance set at SGD 8.8 billion.

• Ongoing focus on operational efficiency, productivity, and cost management to sustain margin improvements.

• Group weighted average borrowing cost for FY2025 expected to remain at mid 3%.