Solid Revenue and Profit Growth in First-Half
Singapore Technologies Engineering (ST Engineering) has reported a robust performance for the first half of 2025, with a significant increase in both revenue and net profit. The company’s net profit surged by an impressive 19.7 percent, reaching $402.8 million, up from $336.5 million in the same period a year prior. This financial growth was primarily fueled by strong revenue from its commercial aerospace and its defense and public security business segments. Overall revenue for the group also climbed, increasing by 7.2 percent to $5.9 billion from $5.5 billion previously. The company noted that revenue growth would have been even higher, at 8 percent, had it not been for the negative impact of a weaker US dollar against the Singapore dollar. Despite this foreign exchange effect and the implementation of US tariffs, the group stated that its mitigation measures were successful, making the overall tariff impact on its half-year results negligible.
Strong Order Book Provides Future Visibility
The company’s strong performance was reflected across its key business segments and is supported by a healthy forward-looking order book. The commercial aerospace segment was a major contributor, with revenue growing by 5 percent to $2.4 billion. Even more significant was the defense and public security segment, which saw a 12 percent increase in revenue to $2.7 billion. While the urban solutions and satellite communications segment saw its revenue remain flat at $921 million, the group’s overall contract wins were impressive, securing $9.1 billion of new contracts in the first half of the year. This has brought its total order book to a substantial $31.2 billion, which, as group CEO Vincent Chong noted, provides strong revenue visibility. The company anticipates delivering about $5 billion from this order book in the second half of 2025 alone, indicating a continued stream of business.
Strategic Divestment Amidst Market Volatility
In addition to its operational successes, ST Engineering is also actively executing a strategic plan to optimize its portfolio. Group president and chief executive Vincent Chong highlighted that recent divestments are a key part of this strategy, allowing the company to exit non-core businesses and re-allocate capital to strengthen its core operations. Despite the company’s strong earnings and clear strategic direction, its shares experienced a decline on the day the results were announced, falling by 4.5 percent to $8.56. This drop occurred after a period of exceptional growth, with the stock having soared by 92 percent in the year up to the previous day when it hit a record high. Alongside the earnings report, the company also declared a second-quarter interim dividend of four cents per share, consistent with the previous year, demonstrating a steady return to shareholders despite the recent stock market fluctuations.
