20171106-辉立证券-Sembcorp_Industries_Ltd_Underlying_business_trend_remains_unchanged_8页_663kb
报告摘要
Sembcorp Industries Ltd 3Q17 Results and Analysis Summary
Core Content Overview
Sembcorp Industries Ltd, a Singapore-based conglomerate, reported its third-quarter results for FY17, showing revenue and net profit that missed expectations by 5.5% and 22%, respectively. The company's performance was influenced by mixed results across its segments, with the Utilities segment performing well while the Marine segment continued to struggle. The report also includes a revised earnings forecast and a valuation analysis based on the sum-of-the-parts (SOTP) method.
Key Financial Highlights
3Q17 Results
- Revenue: SGD 1,808 million, down 15.5% YoY.
- Gross Profit: SGD 232 million, down 22.2% YoY.
- Profit Before Tax (PBT): SGD 70 million, down 20.4% YoY.
- Profit After Tax (PATMI): SGD 34 million, down 43.9% YoY.
The decline in revenue and profit was primarily attributed to the underperformance of the Marine segment, while the Utilities segment showed positive contributions.
Earnings Forecast Revision
- FY17e Earnings Revised Down: From SGD 22.6 cents to SGD 16.9 cents per share.
- FY18e Earnings Revised Down: From SGD 24.5 cents to SGD 17.8 cents per share.
- Target Price Raised: To SGD 3.70, reflecting a higher valuation on Sembcorp Marine (SMM).
Segment Analysis
Utilities Segment
- Singapore Operation: Delivered strong performance with net profit of SGD 51.4 million, representing a 52.1% YoY increase.
- India Operation: Dragged by losses from SGPL, which reported a loss of SGD 26 million in 3Q17.
- Overall Performance: Singapore operations accounted for about 53% of total net profit excluding corporate and exceptional items in the 9 months of FY17.
Marine Segment
- Performance: Continued to show weak profitability, with a net profit of SGD 1.7 million in 3Q17, compared to a loss of SGD 21.8 million in 3Q16.
- 9M17 Net Profit: Slightly increased by 3% YoY to SGD 28 million, but this was due to a gain from the divestment of COSCO stake for SGD 46.8 million.
- Outlook: Expected to benefit from order flows from non-drill solitons, though profitability improvement is anticipated to take time.
Valuation Analysis
Valuation Method
- SOTP Method: Used to value the company by summing the values of its segments.
- Target Price: Maintained at SGD 3.70, with a slightly higher valuation for SMM.
Valuation Table
| Segment | Multiples | BVPS (SGD) | PPS (SGD) | Market Value (SGD mn) |
|---|---|---|---|---|
| Utilities | PB of 1.2x | 1.83 | 2.20 | 3,917 |
| Others | PB of 1.0x | 0.54 | 0.54 | 972 |
| Marine | PE of 38.2x | 0.05 | 1.91 | 2,435 |
| Gallant Venture | Market value | 656.2 | - | 79 |
| Total | - | - | - | 7,403 |
Valuation Ratios
| Ratio | FY14 | FY15 | FY16 | FY17e | FY18e |
|---|---|---|---|---|---|
| P/E (x) | 10.4 | 10.5 | 14.3 | 21.9 | 20.7 |
| P/B (x) | 1.5 | 1.0 | 0.9 | 1.1 | 1.1 |
| EV/EBITDA (x) | 8.8 | 12.4 | 11.9 | 11.0 | 11.1 |
| Dividend Yield (%) | 3.6 | 3.6 | 2.8 | 1.9 | 2.2 |
Financial Ratios
| Ratio | FY14 | FY15 | FY16 | FY17e | FY18e |
|---|---|---|---|---|---|
| Revenue Growth (%) | 1% | -12% | -17% | 10% | 14% |
| Gross Profit Growth (%) | 10% | -48% | 51% | 2% | 11% |
| EBIT Growth (%) | -2% | -45% | 25% | 1% | 7% |
| Net Income Growth (%) | -2% | -31% | -28% | -24% | 5% |
| GP Margin (%) | 13% | 8% | 14% | 13% | 13% |
| EBIT Margin (%) | 10% | 7% | 10% | 9% | 9% |
| NP Margin (%) | 7% | 6% | 5% | 3% | 3% |
| ROE (%) | 15% | 10% | 7% | 5% | 5% |
| ROA (%) | 5% | 3% | 2% | 1% | 1% |
| Net Debt or (Net Cash) | 3,073 | 5,226 | 7,339 | 8,073 | 9,109 |
| Gearing (%) | 42% | 65% | 90% | 96% | 106% |
Outlook and Market Position
- India Power Market: Remains tight, with SGPL expected to suffer from spark spread fluctuations.
- TPCIL and SGI: Continue to perform well, especially SGI, which is securing new orders in the renewable energy market.
- Oil and Gas Market: Showing recovery momentum.
- SMM Outlook: Expected to see more order flows from non-drill solitons, but profitability improvement is expected to take time.
Investment Recommendation
- Rating: Accumulate (Maintained)
- Target Price: SGD 3.70
- Total Return Forecast: 14.5%
Company Data
| Metric | Value |
|---|---|
| Bloomberg Code | SCI SP |
| Outstanding Shares (MN) | 1,784 |
| Market Cap (USD mn / SGD mn) | 4,326 / 5,889 |
| 52-Week High/Low (SGD) | 3.45 / 2.48 |
| 3M Average Daily Turnover (MN) | 3.193 |
Major Shareholders
| Shareholder | Percentage |
|---|---|
| Temasek Holdings Private Ltd | 49.5% |
| Mondrian Investment Partners Ltd | 4.9% |
| Dimensional Fund Advisor | 15% |
Price Performance
| Period | Return (%) |
|---|---|
| 1M TH | 13.0 |
| 3MTH | 5.4 |
| 1YR | 37.8 |
Contact Information
-
Hong Kong Representatives:
- Benny WANG (Dealing Director): (852)22776720 / bennywang@phillip.com.hk
- ZHANG Jing (Research Analyst): (86) 2151699400-103 / zhangjing@phillip.com.cn
- John WONG (Research Analyst): (852) 2277 6527 / johnycwong@phillip.com.hk
- FAN Guohe (Research Analyst): (86)2151699400-110 / fanguohe@phillip.com.cn
- WANG Yannan (Research Analyst): (86) 2151699400-107 / wangyannan@phillip.com.cn
-
Sales Contacts:
- Aric AU (Manager, Corporate & Institutional Sales): (852) 2277 6783 / corporatesales@phillip.com.hk
- Matthew WONG (Manager, International Sales): (852)22776678 / foreignstock@phillip.com.hk
- Yoshikazu SHIKITA (Manager, International Sales, Japan Team): (852) 2277 6624 / yshikita@phillip.com.hk
Disclaimer
- This report is not intended to provide tailored investment advice.
- Investors should seek financial advice regarding the appropriateness of any investments or securities discussed.
- The report is not a solicitation to act as a securities broker or dealer in any jurisdiction not legally permitted.
- Redistribution or disclosure of this report is prohibited without express written consent from Phillip Securities (Hong Kong) Limited.
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