- SIA Engineering (SGX:S59)'s 1HFY26 core net profit slightly above expectations. Excluding a one-off S$4.0mil impairment relating to an underperforming long-term component support contract, core net profit rose 23.3% h-o-h and 27.0% y-o-y to S$87.3mil, accounting for around 51% of consensus full-year estimates.
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SIA Group pricing adjustment and increased work volumes underpin strong operating performance.
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- Operating margin improved to 1.8% in 1HFY26, up 120bps y-o-y, supported by better pricing, scale benefits, and continued learning-curve efficiencies within the engine and component business, and would have reached 2.3% excluding the impairment. On a quarterly basis, underlying 2QFY26 core operating margin would have been 3.2%, signalling a sharper recovery.
- Notably, operations in Singapore delivered S$27.8mil in operating profit versus S$9.5mil a year ago, largely reflecting the rate adjustment under the new comprehensive service agreement with SIA and Scoot.
Associates and JVs firing on all cylinders.
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