SIAEC share price crashed to 5 year low! Amid the global economic uncertainties and challenging aviation outlook, SIAEC’s performance continued to slide as revealed in the financial results for 1HFY2016/17. This article contains my latest SIAEC stock analysis. I am not vested in this counter but have been monitoring this maintenance, repair and overhaul (MRO) stalwart for many years.
Operating profit for 2nd quarter declined to $24.5 million as compared to $27.0 million last year. Cash flow from operations was a negative $7.4 million as compared to positive $2.4 million in the previous year. The dismal quarter results reflected the massive challenge faced by the management in navigating SIAEC through this storm.
It is certainly not business as usual for this MRO powerhouse as airlines are buying new aircraft like A350, B787, A320NEO and B737-MAX to replace their older fleets. These new aircraft require less maintenance checks and longer maintenance task intervals, especially in the first few years of entry into service. Arising from this new trend, the MRO sector in Singapore has seen a decline in business for the last 2 years. This is because about 90 per cent of the local aerospace work is tied to aircraft maintenance and repairs.
For SIAEC, the outlook is [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]
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