Sembcorp Industries - Maybank Research 2024-02-21: Driving Energy Transition; Strong Finish To FY23

• Sembcorp Industries (SGX:U96) reported FY23 net profit of S$970m, +11% and marginally ahead of MIBG/street forecast.

Strong finish to the fiscal year

• 2H23 profit of S$426m grew 15% y-o-y. Revenue for 2H23 fell 14% y-o-y due to lower power prices; this was partly offset by higher revenue from renewable and other business segments.
• - Read this at SGinvestors.io -
• While Sembcorp's near-term earnings have likely peaked, the green transition theme is intact with a de-risked revenue profile.

Continued growth for renewables segment

• Net profit before EI for the renewables segment grew 42% to S$200m, from S$141m in FY22, driven by contributions from acquisitions in China and India, as well as higher contributions from energy storage and solar operations in Singapore.
• - Read this at SGinvestors.io -
• Over the year, Sembcorp secured 4GW of gross renewables capacity through organic growth and M&As, bringing group’s renewable capacity to 13.8GW, at 55% of its 2025 target of 25GW.
• Integrated Urban Solutions revenue fell 6% y-o-y to S$418m due to cessation of a public waste collection contract.

Receding tailwind of elevated power prices

• Read more at SGinvestors.io.

Krishna Guha Maybank Research | https://www.maybank-ke.com.sg/ 2024-02-21 SGinvestors.io

---