Sapura Energy (SapE) reported a headline net loss of RM2.6m attributed mainly to foreign exchange (FX) gains of RM74.2m. Excluding this, the Group reported a core net loss of RM76.9m in its 2QFY23 results, though narrowing its core net loss for 1HFY23 to RM160.9m against RM538.3m in 1HFY22. SapE also reported positive EBITDA of RM562.2m as compared to negative EBITDA of RM1bn in the same period last year. While revenue improved 57% YoY, we opine that overall performance was helped by reversal on claims and liquidation damages though value is unverified at this juncture pending disclosure in the analyst briefing. To recap, the Group reported claims reversal and liquidation damage of RM93m and RM26m respectively in 1QFY23. These results are deemed in line with our expectations with a FY23 forecasted net loss of RM717.4m, though missing consensus estimates of an RM571m net loss. We view the execution of projects to remain challenging given the tough operating environment. As such, we maintain our FY23-25 earnings forecast, with profit margins are expected to remain volatile. Our Neutral call and sum-of-parts derived TP of RM0.05 is retained.
Source: PublicInvest Research - 27 Sept 2022
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Created by PublicInvest | Apr 22, 2024