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  Bookmark this page   Tuesday, 28 Jul 2015
Today's Headlines
Keppel Corporation: A soft quarter

Keppel Corporation reported a 19.3% YoY fall in revenue to S$2.56b and a 2.3% decrease in net profit to S$396.7m in 2Q15, such that net profit accounted for 45% of our full year figure, below ours and the street’s expectations. Operating margin for the O&M division was lower at 13% in the quarter, vs. 14.7% a year ago. A deliberate slowdown in the construction of rigs in Brazil as well as deferment of certain rig projects (outside Brazil) also impacted revenue in the quarter. However, what was more surprising was the continued poor performance from the infrastructure division which saw significant impairments in the quarter. To date, new order wins totaled about S$1.5b vs our full year forecast of S$2b, and management still expects its yards to remain busy in the next two years. However, taking into account the weaker-than-expected results, we tweak our earnings estimates and lower our SOTP-based fair value estimate from S$9.22 to S$8.41. Maintain HOLD.

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Keppel Corporation: A soft quarter
Keppel Corporation reported a 19.3% YoY fall in revenue to S$2.56b and a 2.3% decrease in net profit to S$396.7m in 2Q15, such that net profit acc ...
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