ST Engrg

ST Engrg: Results within expectations. 2Q rev was up 5.8% yoy +1.9% qoq with net profit at $143.2m up 9.7% yoy +6.5% qoq. On a yoy basis rev growth was seen in all divisions except for Aerospace which saw a dip of 2% but profitability grew in all divisions. Despite the lower rev, Aerospace saw profit grow 20% yoy and 37% qoq to $82m on strong profit margins of 17%. The division is also expected to drive growth in 2H with analysts citing ST Engrg’s hangars in Mobile, San Antonio and Panama to possibly benefit from shortages of MRO facilities in the Americas. Recent investment with Airbus, EADS and Elbe may also allow co to benefit from Passenger-to-Freighter conversion contracts. Co has current orderbook of $12.7b. Declares interim dividend of 3c Citi maintains Neutral with TP$3.20. CIMB maintains Outperform but increases TP from $3.49 to $3.79.