ST Engineering posts 9% rise in 9M revenue to S$9.1 billion despite impairments from subsidiary

[SINGAPORE] ST Engineering posted a 9 per cent year on year rise in revenue to S$9.1 billion for the nine months ended Sep 30, on the back of strong performances across all its three business segments, and despite an impairment of S$667 million.

The group is also proposing a special dividend of S$0.05 per share to shareholders in view of the cash proceeds from recent divestments.

Revenue for its commercial aerospace segment was 11 per cent higher year on year, while revenue for its defence and public security segment grew 9 per cent over the same period. Its urban solutions and satcom segment posted a 5 per cent growth in revenue compared to a year ago.

The group also secured a record high of S$32.6 billion in contracts for the nine-month period. This includes the S$4.9 billion in book orders previously reported for Q3 2025.

The group pointed out in its business update on Wednesday (Nov 12) that its divestments year-to-date have generated total cash proceeds of S$594 million, and divestment gains, after tax, of S$258 million.

It is also proposing a special dividend of S$0.05 per share in view of the cash proceeds from the recent divestments. This amounts to S$156 million, or about a quarter of the cash proceeds.

If approved by shareholders, the total dividend for FY2025 will be S$0.23 per share. The total dividend includes a previously announced interim dividend of S$0.04 per share for Q3, to be paid out on Dec 5, 2025.

“The divestments have unlocked value and improved our cash position. We remain financially strong to reinvest to pursue growth as we continue to focus on executing our mid-term plans,” said Vincent Chong, the chief executive officer of ST Engineering.

Non-cash impairments of iDirect Group

Separately, ST Engineering reported a non-cash impairment of S$667 million for its iDirect Group, its satellite communications technology subsidiary.

The group said that it had assessed the value of iDirect Group to be S$170 million as at Sep 30, 2025. This means that the carrying amount for the iDirect Group of S$837 million was impaired by S$667 million.

It cited several factors for the impairment. They include the weakening operating environment, which has seen non-geostationary satellite orbit operators expanding rapidly, while geostationary earth orbit satellite operators launched fewer satellites.

Customer adoption of its next-generation platform, Intuition, has also taken longer than expected given the limited launches by geostationary earth orbit satellite operators.

Furthermore, efforts to turn around iDirect’s business – such as strengthening its management team and rightsizing the organisation – have not been sufficient to turn the business around in the near term.

In the first nine months of 2025, iDirect Group’s year-on-year revenue and earnings before interest, taxes, depreciation and amortisation (Ebitda) declined by 9 per cent and 22 per cent respectively. For FY2024, its Ebit loss was S$89m.

“This financial performance fell below the group’s expectations,” said the group.

ST Engineering said it is exploring “strategic options” for iDirect Group.

“While the group remains positive on the long-term prospects of the satellite communications industry, the near-term operating environment and iDirect Group’s continued losses mean that the turnaround will take longer than expected.”

“Accordingly, the group is evaluating strategic options with the objective of mitigating risks and financial exposures to ST Engineering, as well as strengthening the iDirect Group’s ability to better support its customers,” said the group in its statement.

It added that it has yet to reach a definitive agreement with any party, and there is no certainty that any transaction will take place.

Shares of ST Engineering closed S$0.05 or 0.6 per cent higher at S$8.29 before the announcement.