Sembcorp Marine - CGS-CIMB Research 2022-11-15: Yard Capacity To Return To 70% In FY23

• Sembcorp Marine (SGX:S51) expects losses in 2H22F to be similar to 1H22’s ~S$143m due to higher-than-expected labour costs extending into 2H22F. See Sembcorp Marine's business update announcement dated 15 Nov 2022.
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  • - Read this at SGinvestors.io -
  • In 3Q22, Sembcorp Marine serviced a total of 60 vessels in 3Q22 (1H22: 96 vessels) but stated that improvement in ship repair and upgrades business was slower than its expectations due to more planning required for some of the vessels, including LNG carriers as well as residual effects of COVID-19 measures. However, management sees repair capacity to return to 2019 levels by 2023F. Sembcorp Marine expects newbuild yard capacity could return to 70% of 2019 level.
• Sembcorp Marine has a year-to-date order book of S$7.11bn with S$6.71bn of new contracts (including S$0.42m in repairs and upgrade) in 3Q22. This includes the S$4.25bn P-82 for Petrobras which commences construction in FY23F (engineering, design and procurement phase has started). Together, Keppel Offshore & Marine (KOM) and Sembcorp Marine’s order book is at S$18.9bn. Completion of merger is still set between Dec 22 and Jan 23 as per Sembcorp Marine.
• Reiterate ADD rating on Sembcorp Marine with target price of S$0.19 on 1.6x P/BV.
  • Read more at SGinvestors.io.

Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.

Read also CGS-CIMB's most recent report:
2024-01-30 Seatrium - Toning Down Our Profit Expectations.

Previous report by CGS-CIMB:
2024-01-04 Seatrium - Project Cancelled, But Still An ADD.

Price targets by other brokers at Sembcorp Marine Target Prices.

Listing of research reports at Sembcorp Marine Analyst Reports.

Relevant links:
Sembcorp Marine Share Price History,
Sembcorp Marine Announcements,
Sembcorp Marine Dividend Payout Dates & Corporate Actions,
Sembcorp Marine News