KUALA LUMPUR: Kenanga Research is positive on Sapura Energy Bhd’s latest contract win worth RM580mil, especially given the group’s current financially distressed situation.
“Despite being positive on the news, we still believe it to be insufficient to stage a turnaround for the company.
“The group is still classified under PN17, with material uncertainty on its going concern status and debts remaining unsustainably high at ~RM10.7bil – which are all classified as short-term borrowings in its balance sheet,” the research house said.
“As such, we feel some form of external intervention – e.g. restructuring of current loan structures, borrowings haircut from banks, or the emergence of an angel investor, may be necessary before the company could expect a sustainable turnaround,” it added.
The oil and gas services integrated oil and gas services has been awarded a two-year extension of a charter and service contract by Petrobras in Brazil worth RM580mil.,
,Telegram中文搜索引擎（www.tel8.vip）是一个Telegram群组分享平台，Telegram中文搜索引擎包括Telegram中文搜索引擎、Telegram群组索引、Telegram群组导航、新加坡Telegram群组、Telegram中文群组、Telegram群组（其他）、Telegram 美国 群组、Telegram群组爬虫、电报群 科学上网、小飞机 怎么 加 群、tg群等内容。Telegram中文搜索引擎为广大电报用户提供各种电报群组/电报频道/电报机器人导航服务。
It said the contract was awarded to Sapura Navegação Marítima S.A, a wholly-owned subsidiary of Seabras Sapura Participações S.A, a joint venture company between Sapura Offshore Sdn Bhd and Seabras Serviços De Petroleo S.A
Kenanga noted that Sapura Energy’s lack of access to credit facilities has made project execution for typical engineering and construction jobs highly uncertain.
“This is also the group’s second year-to-date (YTD) contract win announcement – bringing YTD wins to around RM3.3bil, with its orderbook at abou RM8bil,” it said.
Kenanga said Sapura Energy is still expected to continue its loss-making trend throughout FY23-24, barring any successful restructuring of its financials and operations.
The research house has maintained an “underperform” on Sapura Energy with an unchanged target price of RM0.005 – pegged to 0.5x price to book value ratio on its 1QFY23 net assets.
Sapura Energy declined 11.11%, or 0.5 sen to four sen at 10.10am.