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DIRECTORY OF SINGAPORE PROCESS & CHEMICALS INDUSTRIES 2021/2022
Chief Executive Officer Chris Ashton said, “FY2021 has been a year of dynamic global change. Our business has felt the impact of the global economic circumstances, including Covid-19 as global activity slowed and project sanctioning was deferred. Through this year, we’ve acted with agility to accelerate our strategic transformation and position our business for future success. These efforts contributed to an improved result in the second half in line with our expectations.”
“Looking ahead, our backlog has increased over the last six months to $14.3 billion from $13.5 billion with growth from both traditional and sustainability projects. We’ve seen the business begin to stabilize over the second half with activity levels starting to return on long term contracts and strategic new awards in early phases,” he added.
JGC Holdings Corporation also suffered from lower revenue for the financial year ended 31 March 2021, which declined 9.7% to 433.9 billion Yen from 480.8 billion Yen in 2020. However, profit attributable to its shareholders was 5.1 billion Yen, up 24.9% from the year before.
Local PCMs ride
the storm with Government support
Before the pandemic hit, most of the local PCM companies were looking forward to 2020. With several new projects lined up, they were heading for a much better year than 2019. But it was not to be.
By March 2020, the virus which surfaced in Wuhan in October 2019 had morphed into a pandemic, forcing countries to tighten control over movements to contain the spread of the virus. As all facets of the economy were affected, business activities slowed causing oil demand to plummet. Major oil and chemical companies began to put planned projects on hold.
Early measures introduced by the Government to avoid impact of the pandemic on the foreign worker community, after the first infection was reported, failed to stop the almost rapid-fire spread across the process workers’ dormitories.
The Government unveiled almost S$100 billion worth of support measures for industries, some of which allowed the process supporting sector to overcome the most unprecedented challenges ever faced by PCM companies in the history of their business.
For the major locally-listed PCM companies, 2020 was a mix of fortunes as labour shortage and safety measure constraints led to higher costs.
PEC Limited registered a loss of S$13.2 million for the year ended 30 June 2020 compared to a profit of S$9.8 million in the previous year in spite of a 26% jump in revenue to S$495.1 million. The group said the competitive environment and the impact of Covid-19 during the year resulted in a 34% jump in its cost of sales and a slip of 3% in gross profit to S$84.4 million.
Until the lockdown hit, PEC was busy with project and maintenance contracts. Work was
drastically curtailed amid the sudden drop in demand for oil and gas, restriction on global trade and closure of borders, as the virus spread across the world.
“The foreign worker levy waiver and rebates granted by the Singapore Government during this trying period helped ease labour costs as the Group was unable to resume work due to the Covid-19 measures,” PEC said.
It reported that during the year under review it secured two new operating maintenance sites in the People’s Republic of China.
For its first half ended 31 December 2020, PEC reported revenue of S$175.7 million and a net profit after tax of S$3.7 million, reflecting its resilience in the face of the continuing pandemic.
Citing margin and cost pressures, the company said it had made further efforts to grow and diversify its income stream and capabilities. They include setting up new entities in Oman and Singapore to capture new opportunities, such as the design and fabrication of modular process and gas compression solutions.
The Group’s orderbook stood at S$141.0 million as at 31 December 2020, excluding maintenance contracts.
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