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SapuraKencana Q2 Earnings Sink 77%
Malaysia Daily Bulletin | 16 September 2015
By:
  • SapuraKencana Petroleum reported a 76.7 percent decline in 2Q15 net profit to RM104.1 million, impacted by a RM540 million provision for impairment on its oil and gas properties amidst lower oil prices.
  • Excluding the provision, the group would have recorded a pre-tax profit of RM601 million. 2Q15 revenue inched up 4 percent to RM2.8 billion, attributable to new projects executed in the engineering and construction segment and additional contribution from new rigs.
  • An analyst noted that the provision for impairment on assets was a paper loss and the firm will record extraordinary gain at a later period, if markets improve and oil prices rise.

Significance: Despite the longer-than-expected headwinds of weaker oil price, SapuraKencana’s robust order book of RM23 billion to date provides certainty in revenue over the next few years. Going forward, the firm will execute a targeted approach on key geographies and customers to replenish its order book.


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