Engineering forms the backbone of our society.
Everywhere you go, you see evidence of the work of talented, skilled engineers who help to create and maintain the world that we live in.
From lifts and subway stations to cars and buildings, engineering is an integral part of the human race and allows us to advance technologically.
Investors can look to engineering firms to deliver steady profits and consistent dividends.
Here are four Singapore engineering firms that not only reported solid results, but also dish out dependable dividends.
Singapore Technologies Engineering (SGX: S63)
Singapore Technologies Engineering, or STE, is a blue-chip engineering and technology firm serving customers in the aerospace, smart city, defence, and public security sectors.
The group reported a solid set of earnings for the first half of 2024 (1H 2024).
Revenue rose 13.5% year on year to S$5.5 billion while operating profit climbed 17.7% year on year to S$522.9 million.
Net profit improved nearly 20% year on year to S$336.5 million.
STE also generated a positive free cash flow of S$523 million for 1H 2024, in line with the S$521.1 million it churned out a year ago.
An interim dividend of S$0.04 was declared, lifting 1H 2024’s dividend to S$0.08.
STE’s annualised dividend stood at S$0.16, giving its shares a dividend yield of 3.6%.
The engineering giant snagged S$6.1 billion of contracts for 1H 2024 and boasted an order book of S$27.9 billion as of 30 June 2024.
Around S$4.9 billion of these contracts are expected to be delivered by this year.
Boustead Singapore Limited (SGX: F9D)
Boustead Singapore Limited, or BSL, is a conglomerate with four divisions – energy engineering, real estate, geospatial technology, and healthcare.
The engineering group reported a strong set of earnings for its fiscal 2024 (FY2024) ending 31 March 2024.
Revenue jumped 37% year on year to S$767.6 million, lifted by higher contributions from all divisions except for Healthcare.
Gross profit improved by 44% year on year to S$226.7 million.
Net profit excluding exceptional, one-off items doubled year on year from S$31.5 million to S$63.3 million.
BSL generated a positive free cash flow of S$91.8 million, 24% higher than the S$74 million churned out in FY2023.
A final dividend of S$0.04 was declared, taking FY2024’s total dividend to S$0.055.
This level of dividend was 37.5% higher than the S$0.04 paid out for FY2023.
BSL’s engineering order backlog stood at S$247 million as of 31 March 2024 but the group secured an additional S$36 million in new engineering contracts in early FY2025.
For its Geospatial division, it booked a record-high deferred services backlog of S$129 million.
Nordic Group (SGX: MR7)
Nordic is an engineering solutions provider serving the marine, offshore oil and gas, petrochemical, pharmaceutical, infrastructure, and semiconductor industries.
The group has a production facility in China and also has operations in Malaysia.
Nordic reported a downbeat set of earnings for 1H 2024 as revenue tumbled 15% year on year to S$76.2 million.
The drop was because of the completion of several large projects back in 1H 2023, but this was offset by a 19% year-on-year increase in maintenance services revenue for 1H 2024.
Net profit for 1H 2024 fell by 16% year on year to S$8.5 million.
Despite the weaker profit, Nordic managed to generate a positive free cash flow of S$5.5 million, reversing the negative free cash flow of S$3.7 million back in 1H 2023.
An interim dividend of S$0.008526 was declared, slightly lower than the S$0.01001 paid out a year ago.
For 1H 2024, Nordic managed to replenish its order book to S$240.1 million, around 28% higher compared to the end of 2023.
Management will also focus more on acquiring maintenance contracts to improve recurring income, which currently forms around 40% of the group’s total revenue.
Civmec Singapore Ltd (SGX: P9D)
Civmec is an integrated construction and engineering services provider to the energy, resources, infrastructure, marine, and defence industries.
The group is headquartered in Australia and its core capabilities include heavy engineering, shipbuilding, site civil works, maintenance, and others.
The engineering group reported a robust set of earnings for FY2024 ending 30 June 2024.
Revenue rose 24.4% year on year to A$1 billion with net profit increasing by 11.6% year on year to A$64.4 million.
The group generated a positive free cash flow of A$46.1 million for FY2024, though this was 39% lower than the A$75.4 million churned out a year ago.
Management declared a final dividend of A$0.035, taking total dividends for FY2024 to A$0.06.
This was a 20% year-on-year increase from the A$0.05 paid out in FY2023.
Civmec’s order book ended the fiscal year at A$853.4 million.
The group is also committed to supporting future shipbuilding programmes in the defence sector and is working towards formalising a memorandum of understanding to tender for a landing craft heavy shipbuilding programme for the Commonwealth of Australia.
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Disclosure: Royston Yang owns shares of Boustead Singapore Limited.
