Yahoo Finance 5 Blue-Chip Companies That Turned Their Losses into Profits
2020 was a tough year for most companies but things are looking up.
With various COVID-19 vaccines being distributed worldwide, more people are getting inoculated, thus reducing the virus’ spread and severe effects.
Blue-chip companies that suffered a year ago are now seeing better prospects.
Restrictions are being gradually eased in Singapore, while economies are opening up in other countries.
Here are five blue-chip businesses that reported a turnaround in their latest results.
Genting Singapore Ltd (SGX: G13)
Genting Singapore owns and operates Resorts World Sentosa (RWS), an integrated resort (IR) that houses six hotels with around 1,600 rooms, a casino, a theme park and more.
The group suffered from a dearth of tourists last year as Singapore initiated its “Circuit Breaker” from April through June.
Most operations at RWS ceased for three months, leading to the group incurring a net loss of S$116.7 million for the first half of 2020 (1H2020).
Things are looking better today.
For 2021’s first half (1H2021), revenue has increased by 24% year on year to S$554.8 million, with the group chalking up an operating profit of S$121 million, reversing its S$120.5 million operating loss last year.
Gaming revenue surged by 61.4% year on year to S$443 million, helping to offset the decline in revenue from hotel rooms and attractions.
As a result, Genting posted a net profit of S$88.2 million for 1H2021.
The group had acquired leasehold land amounting to S$880 million for the planned expansion of the RWS IR and is expected to remain resilient.
Singtel (SGX: Z74)
Singtel had a rough year too when roaming revenue fell due to a significant plunge in travel.
However, the telecommunication company reported a better set of numbers for its recent fiscal 2022 first-quarter business update.
Operating revenue rose 7.5% year on year to S$3.8 billion while operating profit jumped by 19.1% year on year to S$312 million.
The group reported a net profit of S$445 million for the period, reversing a loss of S$20 million in the prior year.
Last year’s loss was caused by its associate Airtel’s provisions for tax charges and regulatory costs.
Keppel Corporation Limited (SGX: BN4)
Keppel is an oil and gas conglomerate that has seen its fair share of challenges over the years, beginning with the oil price crash in 2014.
A second oil price crash in 2020 caused its offshore and marine (O&M) division to undergo a strategic review late last year.
This review culminated in the proposed restructuring of its O&M division by splitting it into three parts.
Keppel reported a stronger set of numbers for 1H2021.
Revenue rose by 15.5% year on year to S$3.7 billion, boosted by a 78% year on year increase in revenue for its Urban Development division.
The group booked an operating profit of S$188 million, reversing the S$149.4 million operating loss in the same period last year.
Net profit stood at S$299.8 million, a sharp turnaround from the S$537.1 million net loss last year.
In light of the good results, Keppel declared an interim dividend of S$0.12, four times what it paid out last year.
UOL Group (SGX: U14)
UOL Group is a leading property company with total assets of around S$20 billion.
The group has a diversified portfolio of development and investment properties, hotels and serviced residences across Asia, the US and Europe.
For 1H2021, revenue improved by 31% year on year to S$1.2 billion, aided by higher contributions from property development and investments.
Net profit came up to S$91.3 million, reversing the net loss of S$82.1 million in the same period last year.
For 1H2020, UOL Group suffered from a large S$263.8 million fair value loss on its investment properties, pushing the group into the red.
Free cash flow for 1H2021 was also healthy at S$252 million.
UOL Group CEO Liam Wee Sin sees continued healthy demand in Singapore’s residential market but is worried about rising construction costs due to manpower shortages and supply chain disruptions.
Sembcorp Industries Ltd (SGX: U96)
Sembcorp Industries Ltd, or SCI, is an energy and urban solutions provider with an energy portfolio of over 12,800 MW.
The group’s revenue increased by 26% year on year to S$3.3 billion as an improvement in power demand boosted revenue from its conventional energy segment.
Gross profit jumped by 50% year on year to S$530 million and SCI booked a small net profit of S$46 million, reversing last year’s S$42 million net loss.
The group declared an interim dividend of S$0.02.
For context, there was no interim dividend paid last year.
SCI is continuing with its journey to transform its portfolio to focus more on sustainable solutions.
In 1H2021 alone, 78 MW of renewable energy capacity was installed.
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Disclaimer: Royston Yang does not own shares in any of the companies mentioned.
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