Singapore Daily Bulletin – 14/11/12

3Q Of 2012 Sees Gloomy Business Prospects
According to the Business Times – UniSIM Business Climate Survey, business pessimism continues to spread among companies in Singapore. 59 percent of the firms polled are expecting gloomier business prospects in the six months till March 2013 – with 10 percent saying things could get “much worse”. More firms experienced a contraction in sales and new orders last quarter and though fewer firms’ profits fell in 3Q12, more suffered larger profit declines, the quarterly survey shows ahead of final GDP figures for 3Q due for release this Friday. But economists think that the advance estimate may be revised downwards, given poorer than expected trade and industrial production data for September. It was the construction sector which emerged as the star performer for a second consecutive quarter on the survey; being the top performer in sales and profits, and shared the top rank with the financial and business services sector when it came to new business.

Significance: Nonetheless, against the negative backdrop, the survey predicts that GDP may at best stagnate in the fourth quarter with marginal year-on-year growth of 0.2 percent, or at worst, contract by 0.9 percent from the previous year. If so, this implies full-year GDP growth of between 1.1 and 1.3 percent for Singapore, which is under the official forecast range of 1.5 to 2.5 percent.

Swiber Scores US$143m Worth Of Contracts; Posts Positive 9M12 Earnings
World class integrated construction and support services provider to offshore oil and gas industry, Swiber Holdings, reported a 14 percent rise in net profit to US$46 million in tandem with a 47 percent surge in revenue to US$689.3 million for the nine months ended 30 September. The earnings were supported by steady gross profit margin at 15.7 percent on the back of strong revenue growth driven by awards of contracts in South Asia, Southeast Asia and Latin America. Notably, Swiber has also recently secured sizeable US$143 million worth of contract wins, bringing its order book to approximately US$1.4 billion, which Francis Wong, chief executive officer of Swiber, highlighted as a strong endorsement of Swiber’s capabilities by oil majors.

Significance: With Swiber’s strong order book and 9M12 performance surpassing its FY11 topline and bottomline results, it is clear that Swiber is on its way to a strong FY12 performance and its strategies to expand its capabilities and geographical reach continued to bear fruits.

Frasers Commercial Trust Announces $7.7m Enhancement Initiatives
Frasers Commercial Trust (FCOT) announced a $7.7 million asset enhancement initiative for the office tower at China Square Central to create a more contemporary, elegant and conducive working environment. Some of the key areas of the enhancement are to enlarge the main lobby, create more comfortable and environment-friendly restrooms as well as shower facilities to complement the new bicycle park facility for cyclists amongst others. The enhancement works are scheduled to commence in November 2012 and is expected to complete in 6 months to include furnishings and facilities commonly found in Grade A office buildings as part of FCOT’s proactive asset management strategy to continuously unlock greater value from its portfolio and enhance the revenue generating ability of its properties.

Significance: The asset enhancement initiative would be able to boost the competitive position of China Square Central and at the same time, capitalise on the opening of the new Telok Ayer MRT station that will provide greater connectivity and accessibility.