October 20, 2016 / 10:17 AM / in 2 years

BRIEF-Keppel Corp says Q3 net profit down 38%

Oct 20 (Reuters) - Keppel Corporation Ltd :

* 3Q 2016 net profit down 38% to s$225 million, compared to s$363 million for 3q 2015

* q3 revenue s$1.46 billion versus s$2.44 billion last year

* “demand in offshore market is expected to remain tepid”

* no dividend recommended for current financial period

* “rightsizing of keppel o&m business will continue as we prepare for an extended period of weaker demand for new oil rigs”

* Landscape for offshore & marine (o&m) remains very challenging

* “we expect that our o&m business will be increasingly diversified beyond just oil and gas”

* “will increasingly also look into early termination of contracts and selective retrenchment in singapore”

* for first nine months of year, keppel o&m has reduced its direct workforce by close to 8,000 or around 26%.

* on sete’s plans, we believe that provision of s$230 million taken at end of 2015 remains appropriate and adequate

* “senior management across all keppel business units have voluntarily taken a reduction in monthly salary”

* “directors of keppel corporation will also be proposing lower directors’ fees for 2016 at next year’s agm”

* “we are also reviewing our yard capacity in light of declining workload”

* “we have also worked on cutting our overheads which have come down by close to 20% year-on-year in first nine months of 2016”

* “as we look to turn inventory more, we can rightsize property book & re-deploy balance sheet space that is freed up for other growth businesses”

* “we aim to increase inventory turn and launch more homes for sale, especially in those markets with favourable conditions” Source text for Eikon: Further company coverage:

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