|
 |
| We are a leading industrial
utilities and site services provider. We offer process
industry MNCs a range of fully integrated industrial
site services, including natural gas, power, steam,
cooling water, high grade industrial water, wastewater
treatment and chemical waste incineration. |
| |
| We have established facilities
serving chemical hubs in Singapore and the United
Kingdom, and our coverage expands to countries such
as China, Vietnam and Australia. In China, we are
replicating our cogeneration and centralised utilities
capabilities in major chemical industrial parks
in Shanghai and Nanjing. We are also a leading offshore
turnkey contractor for oil and gas upstream fixed
platforms and floating production facilities. |
| |
| Operations
Review | Outlook
| Orderbook |
| |
Operations
Review
Our Utilities business performed strongly in 2003,
showing both topline and bottomline growth. Turnover
rose 79% over the previous year to S$1,950.5 million
while Profit After Tax and Minority Interest (PATMI)
also grew 81% over 2002 to S$98.3 million. With
turnover growing at a three-year compounded annual
growth rate (CAGR) of 85% and a PATMI three-year
CAGR of 89%, SembCorp Industries’ Utilities
arm now accounts for 35% of Group PATMI.
All divisions registered double-digit revenue growth
over the previous year and contributed to the strong
performance.
Our integrated utilities division performed better
than the year before, with enhanced growth through
the strategic acquisition of SembCorp Utilities
UK (formerly SembCorp Utilities Teesside). In April
2003, the assets and business of Enron Teesside
Operations, a leading centralised utilities business
in the United Kingdom located at Teesside, was acquired
for S$244.2 million. Together with SembCorp Utilities
UK’s customer base, we now serve more than
70 international companies and are able to leverage
on this enlarged global customer base for our future
growth as the world’s leading centralised
utilities provider in the process industry sector.
Our operations in Singapore and the United Kingdom
also continued to secure new contracts in 2003.
A total of 93 new utilities and services contracts
worth a total of approximately S$93 million over
a period of one to ten years were clinched in the
year. Our Energy division also performed well. With
the New Electricity Market (NEM) launched in January
2003, our cogeneration plant in Singapore, SembCorp
Cogen (SembCogen), is now profitable and was a significant
contributor to the division’s performance.
SembCorp Gas (SembGas) secured 13 new contracts
worth a total ofS$550 million over 15 years, while
SembCorp Power (SembPower) ended the year with 461
customer accounts.
SMOE, our offshore engineering unit, also turned
in a strong performance in 2003. The Halfdan Field
Development topside and accommodation module project
for Maersk Olie OG Gas and the Panyu Joint Development
platform and pipeline facilities project for Devon
Energy China were successfully delivered in 2003.
We also secured a S$175 million project for the
Bongkot Field Development from PTT Exploration and
Production Public Company. SMOE’s first purpose-built
fabrication yard in Batam, Indonesia commenced operations
in November 2003. A low-cost fabrication base, the
yard will support SMOE’s projects for the
international market and its expansion in the Indonesian
oil and gas market.
A leading niche player providing integrated industrial
site services to process industry clusters, we intend
to replicate the success of our multi-utility concept
abroad. 2003 saw significant advancement of this
strategy with the establishment of our presence
in China’s major petrochemical hubs, namely
in Shanghai Chemical Industrial Park and Nanjing
Chemical Industrial Park, the only two State Level
chemical parks in the People’s Republic of
China.
In March 2003, we entered into a joint venture to
build, own and operate a wastewater treatment plant
in Nanjing Chemical Industrial Park. The wastewater
treatment plant has an initial capacity of 12,500
cubic metres per day and is expected to start operations
in the fourth quarter of 2004. We own a majority
75%stake in Nanjing SembCorp SUIWU, with Singapore
Utilities International and Nanjing Chemical Industrial
Park Company owning 20% and 5% respectively.
We also invested in a 605-megawatt cogeneration
plant in Shanghai Chemical Industrial Park in April
2004. With a total investment cost of S$725 million,
the facility will be the largest combined cycle
gas turbine cogeneration power plant in China. We
have a 30% stake in the joint venture company Shanghai
Caojing Cogeneration Company. Shanghai Electrical
Power Company, Shanghai Shenergy Company and Shanghai
Chemical Industrial Park Development Company own
the remaining 36%, 30% and 4% respectively.
With this recent investment, we now have over 2,400
megawatts of gross power generation capacity installed
and in development across the globe.
In December 2003, we acquired all the shares held
by Tractebel in SUT Sakra (20%), SembCogen (30%)
and SembGas (20%) for a total cash consideration
of S$184 million. SUT Sakra and SembCogen are now
wholly-owned subsidiaries of SembCorp Utilities,
while our shareholding in SembGas has increased
from 50% to 70%. The consolidation of SembGas’
revenue as a subsidiary for the month for December,
as well as the additional contribution arising from
the acquisition of Tractebel shares also contributed
to the improved performance of these businesses.
With full management control of SUT Sakra and SembCogen
as well as majority control in SembGas, we now have
the flexibility to consolidate our profitable Singapore-based
operations. |
| |
Outlook
We expect continued growth in the profit-ability
of our Utilities operations. Management targets
2004 PATMI to grow by more than 20% over 2003. This
performance will be underpinned by stable baseload
earnings from our long-term contracts, as well as
SMOE’s healthy orderbook, which stood at S$499
million as at end December 2003. 2004 will also
see the first full-year of contribution from SembCorp
Utilities UK, as well as increased contributions
from the now wholly-owned SUT Sakra and SembCogen,
and 70%-owned SembGas. Our joint venture cogeneration
plant Phu My 3 in Vietnam commenced operations in
February 2004, while Nanjing SembCorp SUIWU will
come onstream in the last quarter of 2004. Shanghai
Caojing Cogeneration is expected to start commercial
operations by early 2006.
We expect our businesses in Singapore to continue
to perform well as we focus on maintaining our domestic
market leadership position. Capitalising on the
growing trend in the outsourcing of site services
and the growth of petrochemical hubs in countries
such as China, we will continue to develop and grow
our businesses overseas as a provider of integrated
industrial site services to MNC process industry
clusters. |
| |
Orderbook
The orderbook for SMOE as of end December
2003 was S$499 million. Our major projects are:
| Project |
Original
Contract Value (S$m) |
Client |
Scope of Work |
Date of Completion |
 |
| Bongkot Field development Phase
3C |
175 |
PTT Exploration and Production
Public Company |
Engineering, procurement, supply,
fabrication, transportation and installation of
offshore processing platform |
4th quarter 2003 |
|
| Dan FG Development
Project1 |
- |
Maersk Olie OG Gas AS |
Engineering, procurement, fabrication
and commissioning of process/utility module, jacket,
flare structure and bridge |
2nd quarter 2004 |
|
| Idd El Shargi North Dome Offshore
Oil Field1 |
- |
Occidental Petroleum of Qatar |
Engineering, procurement, fabrication,
precommissioning, loadout, transportation, hook-up
and commissioning of central processing facility
platform, bridges and flare platform |
1st quarter 2005 |
|
| Erha FPSO Project1 |
- |
Saipem |
Detailed engineering, procurement,
fabrication and integration to hull FPSO topsides
modules |
2nd quarter 2005 |
| 1The
total contract value for these three contracts secured
in 2002 is S$530 million. The individual contract
values are not disclosed at the request of the clients. |
|
|
| |
|
|
|
|
|
|
| |
 |
| |
|
|
2003 |
2002 |
|
| |
|
S$m |
S$m |
|
|
|
Revenue |
1,950.5 |
1,088.6 |
|
| |
PATMI |
98.3 |
54.2 |
|
|
|
| Note:
Figures are taken at SembCorp Utilities’ Group Level |
| |
 |
| |
| Key
Facts |
|
| • |
A pioneer in the concept
of integrated multi-utility centres |
| • |
First commercial importer, supplier
and retailer of natural gas in Singapore |
| • |
Over 2,400 megawatts of gross
power generation capacity installed and in development
globally |
| • |
Largest industrial wastewater
treatment provider in Singapore |
| • |
Partner in China’s largest
cogeneration plant in Shanghai Chemical Industrial
Park |
| • |
First independent power producer
in Vietnam |
| • |
Over 100 offshore oil and gas
projects delivered worldwide |
|
| |
| Competitive
Edge |
|
| • |
First-mover and industry
leader in Singapore's integrated utilities and energy
market |
| • |
Proven business model
and track record as a pioneer in the concept of
multi-utility facilities, with the ability to replicate
our business model |
| • |
Wastewater treatment
with unique track record and experience in treating
wastewater from multiple sources and customers |
| • |
Ability to generate
benefits to customers through the integrated and
bundled offer of gas, electricity and centralised
utilities |
| • |
Unique cogeneration
experience in providing support to petrochemical
hubs where a high reliability of steam supply is
required |
| • |
Strong engineering
capability and unique ability to offer a full range
of total turnkey capabilities in offshore oil and
gas engineering |
|
| |
 |
| |
|
|
|
