Sembcorp Marine - Maybank Kim Eng 2015-12-02: Expect losses in 4Q15

SEMBCORP MARINE LTD S51.SI 

Sembcorp Marine (SMM SP) - Expect losses in 4Q15  

Warns of net loss in 4Q15 

• SMM warned that it will have a net loss in 4Q15 and FY15 net profit will be significantly lower YoY when it reports on 15 Feb 2016. It attributes the expected 4Q loss to a challenging operating environment and customers deferring or seeking to defer their rig orders. 
• We cut FY15E/16E EPS by 33%/6% as we factor in more deferrals and importantly, an assumed provision of SGD70m in 4Q15. 
• Reiterate SELL and TP of SGD1.75 as we continue to expect weak order wins, cancellation risks and unresolved payment issues from Sete Brasil to weigh on the stock. 

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