SINGAPORE Technologies Aerospace (STAe) managed to show a modest profit for the first half of the year, boosted by strong growth from its restructured maintenance businesses.
The group ended the half year with a profit of just under S$7 million ($5 million), turning round a loss of $47 million a year ago, when STAe had faced problems at its third-party-maintenance operation, ST Aviation Services, (SASCO) and been forced to make a write-down on military spares.
The turnaround at SASCO was largely responsible for the improved STAe profits, helping to produce a 43% leap in sales at the group's commercial division. SASCO is now benefiting from a stronger US dollar, higher work rates and joint marketing with US subsidiary Mobile Aerospace Engineering.
Profit margins for STAe's Military Business group also improved slightly, thanks to cost cutting, but are "still well below the desired level".
According to James Capel analyst Shane Matthews, "-we're looking at a slightly better year ahead". STAe's net profit is projected to reach nearly S$17 million by the year-end.
Source: Flight International
