Keppel Earnings: Net Profit Miss Due to Legacy Offshore and Marine Assets

Keppel’s first-half 2024 net profit was dragged down by its legacy offshore and marine assets, resulting in a 31.6% year-on-year decline to SGD 304 million. The losses from the legacy assets relate to the fair value losses of its Seatrium shares, the Asset Co vendor notes, and Keppel’s stakes in Floatel and Dyna-Mac. Excluding these, net profit rose 7% year on year, driven by higher contributions from its infrastructure and connectivity segments, partly offset by its real estate segment. We cut our 2024 earnings per share estimate by 14% after factoring in losses from its legacy assets and have adjusted our 2025-26 EPS estimates lower by 3%-5% after reducing our forecasts of share of profits from associated companies and joint ventures.