Keppel's Penalty to Settle Criminal Investigation Plunges Rigbuilder Into Rare Loss

By FeaturesDow Jones Newswires

Singapore conglomerate Keppel Corp. (BN4.SG) posted a rare quarterly net loss after its marine arm paid a penalty to settle a criminal investigation into its operations in Brazil.

Net loss for the October-December quarter was 495.8 million Singapore dollars (about US$380 million), compared with a profit of S$143.1 million a year ago, Keppel, one of the world's biggest rig builders, said in a stock-exchange filing Thursday. Its revenue declined 20% to S$1.54 billion (US$1.18 billion) from S$1.94 billion.

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In December, Keppel agreed to pay US$422 million to resolve a bribery probe in the U.S., Brazil and Singapore related to its operations in Brazil. The earnings report included a S$618.7 million one-off financial penalty and related legal, accounting and forensics costs, Keppel said.

For the full year, net profit fell to S$217 million from S$784 million in 2016, Keppel said, adding that without the penalty, profit would have risen 7% last year.

The resolution of the investigation brings to an end a "painful chapter" for Keppel, said Chief Executive Loh Chin Hua. "We have put in place effective compliance controls to ensure that this does not happen again," he said.

While the offshore and marine division reported a S$835 million loss last year, profit at Keppel's property division rose 10% to S$685 million. The infrastructure business returned a 33% growth in profit last year, at S$132 million.

Write to Gaurav Raghuvanshi at

(END) Dow Jones Newswires

January 25, 2018 05:28 ET (10:28 GMT)

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