SINGAPORE: Despite Sembcorp Industries crossing the S$1 billion mark in net profit for the second consecutive year, group CEO Wong Kim Yin’s total pay dropped 18.91% to S$6.41 million for FY2024 compared to FY2023, as reported by The Edge Singapore.
Another CEO whose pay dropped despite his company’s record profit was UOB Deputy Chairman and CEO Wee Ee Cheong. His total pay for 2024 fell by 5.5% to S$15 million, despite the bank’s 5.8% increase in net profit to S$6.05 billion.
On Wednesday (April 2), the company’s annual report revealed that Mr Wong’s base pay was S$1.37 million, along with a cash bonus of S$1.568 million.
In FY2023, he received a higher cash bonus of S$2.524 million, based on the company’s performance in key areas like net profit, return on equity, carbon intensity, and ESG-related targets contributing to his larger payout that year. In its FY2024 results briefing, Sembcorp announced a higher dividend of 23 cents per ordinary share, up from 13 cents in FY2023. The payout ratio increased to 40%, compared to 23% the previous year and an average of 27% from FY2021 to FY2023.
The group’s net profit before exceptional items (EI) was S$1.02 billion, crossing the S$1 billion mark for the second consecutive year. Mr Wong said this strong performance gave Sembcorp the confidence to raise dividends.
He said the company had been “quite careful” about increasing dividends in the past, even when business was strong, to signal to shareholders that it might be a one-time event. “We started with giving out special dividends because we wanted to signal [that] maybe this is a one-time thing,” he said.
Now, with the announced 23-cent ordinary dividend, he added, the company is confident it can sustain this moving forward. “We have entered a new phase,” he said, describing it as the company’s “new normal”.
Sembcorp’s operations are divided into five segments: decarbonisation solutions, gas and related services, integrated urban solutions, renewables, and other corporate businesses.
Despite the 10% year-on-year (YoY) drop in the gas and related services segment net profit before EI to S$727 million, Mr Wong highlighted in his annual report that the company has made significant progress in its 2024-2028 strategic plans to meet Asia’s evolving needs in the energy sector.
He noted that the gas and related services segment remained resilient, even with a 34% drop in Singapore’s wholesale electricity prices. He also highlighted Sembcorp’s position as the leading power provider for data centres in Singapore and its acquisition of a 30% stake in Senoko Energy in November 2024.
The company divested 49% of its Chongqing Songzao stake, making its portfolio free of coal-fired power assets. In addition, the company’s renewable energy capacity reached 13.1 gigawatts (GW) in 2024, moving closer to its 2028 target of 25 GW.
At the end of January, the company also announced that its subsidiary, Sembcorp Energy Philippines, has signed a deal to buy all shares of Puente Al Sol from CleanCurrent Renewable Energy Inc (CREI) for S$105 million. Puente Al Sol is developing a 96 megawatt (MW) solar farm in Cadiz, Philippines.
While the deal is still subject to conditions, including regulatory approvals, it is expected to be completed in the second half of this year. The solar farm’s purchase will be funded through Sembcorp’s internal cash and external borrowings. /TISG
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