Strong results beat on higher-than-expected margins.CSE Global (SGX:544)’s 2024 net profit of S$26m (+17% y-o-y) beat consensus and our expectations by 4%/18%. Excluding the one-off arbitration settlement of US$8m (S$10.4m), core net profit surged 63% y-o-y to S$37m. This was on the back of revenue growth (+19% y-o-y) and corresponding improved operating leverage.
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Lower final dividend to reinvest in long-term growth.
A 23% lower final dividend of 1.15 cents/share was proposed (2023: 1.5 cents). With the interim dividend of 1.25 cents/share (2023: 1.25 cents), total CSE Global's dividends amounts to 2.4 cents/share (2023: 2.75 cents) and translates to a healthy 64% payout ratio.
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Continued revenue growth across all segments.
Electrification revenue continued to be the largest revenue contributor (around 50%), growing 30% y-o-y to S$435m from major contracts secured in 2023 and new projects in 2024.
Communications revenue saw a 5% growth to S$232m, due to new acquisition contributions.
Automation revenue also rose 14% y-o-y to S$194m, fuelled by stronger contributions from the Americas and Asia Pacific regions.
Healthy order win momentum supports revenue growth.
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Above is an excerpt from a report by UOB Kay Hian Research. Clients of UOB Kay Hian may be the first to access the full PDF report @ https://www.utrade.com.sg/.
