PETALING JAYA: Sapura Energy Bhd’s net loss narrowed to RM31.09 million in the third quarter ended Oct 31 from RM274.41 million a year ago, in line with a higher revenue, which rose 17.36% to RM1.50 billion from RM1.28 billion a year ago.
During the quarter, the group registered a pre-tax profit of RM40.3 million compared with a pre-tax loss of RM209.7 million, marking the first profit recorded by the group since the second quarter ended July 31, 2017.
The group attributed the higher revenue to its engineering and construction (E&C) and exploration and production (E&P) business segments.
Increased E&C activities during the quarter resulted in a 17% rise in revenue to RM959.8 million from RM822.3 million while the drilling segment’s pre-tax loss narrowed to RM11.7 million from RM93.1 million a year ago.
The E&P segment recorded higher pre-tax profit of RM37.1 million from RM28.3 million a year ago while revenue rose 43% to RM296.2 million from RM207.7 million a year ago due to higher production liftings and the effects of the higher average realised oil and gas prices achieved.
For the nine months ended Oct 31, Sapura Energy’s net loss widened to RM292.88 million from RM217.95 million a year ago while revenue fell 18.89% to RM3.82 billion from RM4.71 billion a year ago.
“The improved results indicate the group’s initial signs of a turnaround. We are seeing an upward trend in all segments, in particular the E&C business, driven by an increase in global investments and activities. As our orderbook grows, revenue will move up in tandem with project completion from commencement to book recognition,” said president and group CEO Tan Sri Shahril Shamsuddin.
Meanwhile, Sapura Energy and its consortium partner have won a RM3 billion contract from Oil and Natural Gas Corp Ltd (ONGC) in India.
The consortium partners comprising Sapura Energy’s wholly owned subsidiary Sapura Fabrication Sdn Bhd and Afcons Infrastructure Ltd, will be jointly undertaking engineering, procurement, construction, installation and commissioning works for a Central Processing Platform and Living Quarters for KG-DWN 98/2 NELP block.
The block, located offshore the Godavari Delta on the east coast of India, covers an area of about 7,295km of the Krishna-Godavari basin with water depth ranging between 300m to 3,200m.
Sapura Fabrication’s share in the consortium is 48.3% which translates to about RM1.47 billion in contract value. The works are expected to be completed by January 2021.
Sapura Energy said the new contract win enhances the group’s presence in the growing market.
“The project is an opportunity for Sapura Energy to participate in a key development for ONGC, leveraging on the company’s established deepwater knowledge and capabilities.”
Afcons is the construction arm of India’s engineering and construction conglomerate Shapoorji Pallonji Group.
Sapura Energy expects the contract to contribute positively towards its earnings for the financial year ending Jan 31, 2019, and for the financial period thereafter within the duration of the contract.