SIA Engineering - UOB Kay Hian 2024-07-29: 1QFY25 Earnings A Slight Miss, But May Catch Up In The Rest Of FY25

• SIA Engineering (SGX:S59)’s 1QFY25 net profit of S$33.2m (+23.0% y-o-y, -4.8% q-o-q) came in slightly behind our projection, at 21.4% of our full-year forecast. 1QFY25 revenue of S$268.7m (+2.6% y-o-y, -6.9% q-o-q) formed 21.7% of our full-year forecast.

Operating profit weaker than expected.

• - Read this at SGinvestors.io -
• Two factors that adversely affected SIA Engineering’s operating profit this quarter include:
  1. lumpy project revenue recognition – fewer maintenance, repair and overhaul (MRO) projects were completed during 1QFY25 due to heavier project contents; nevertheless, the delays in project completion and hence lesser revenue recognition in the past quarter should lead to higher revenue recognition in future quarters; and
  2. - Read this at SGinvestors.io -

JVs and associates remained key contributors.

• JVs and associates turned in S$28m profit in 1QFY25 (+27.9% y-o-y, +3.1% q-o-q), slightly stronger than our projection and at 26.2% of our full-year forecasts. The decent performance was mainly driven by the strength in the engine and component JV/associate entities.

Continued recovery of flight activities at Changi Airport.

• Read more at SGinvestors.io.

Roy Chen CFA UOB Kay Hian Research | https://research.uobkayhian.com/ 2024-07-29 SGinvestors.io

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