SAPURA Energy Bhd reported a net loss of RM286.1 million for the third quarter ended October 31, 2024 (3Q25), a significant reversal from a net profit of RM31.79 million in the same quarter last year.

The loss was primarily due to substantial foreign exchange (forex) losses amounting to RM213 million.

These forex losses were driven by the weakening of the ringgit against the US Dollar, compared to a forex gain of RM271 million in the same period last year.

In a separate statement, Sapura Energy said that while the group effectively maintains a natural hedge against foreign currency exposure at an operational level, it is impacted by unrealised foreign exchange losses arising from its existing multi-currency financing facilities.

“This underscores the critical importance of restructuring our debt portfolio to mitigate these risks. We are actively working with lenders and creditors to accelerate this exercise and enhance the Group’s financial stability and resilience for the future,” said interim Chairman Shahin Farouque Jammal Ahmad (picture).

The group’s share of profits from associates in 3QFY25 also decreased by RM93.7 million due to the reclassification of SapuraOMV Upstream Sdn Bhd to an asset held for sale since the first quarter of financial year 2025.

Additionally, the group’s bottom line was impacted by a lower share of profit from associates following the reclassification of SapuraOMV Upstream Sdn Bhd as an asset held for sale.

As a result, the company posted a loss per share of 1.59 sen, compared to an earnings per share of 0.19 sen in the previous year.

Revenue for the quarter, however, rose by 4.4%, reaching RM1.15 billion, up from RM1.1 billion in Q3 FY2024. The growth was driven by higher project progress, favorable settlement of claims in the engineering and construction (E&C) segment, and increased activity in the operations and maintenance (O&M) sector.

For the nine-month period, Sapura Energy recorded a net loss of RM342.96 million, a sharp contrast to a net profit of RM213.18 million in the same period last year.

This was despite an increase in revenue to RM3.54 billion, up from RM3.2 billion.

According to Shahin Farouque, Sapura Energy’s business expansion continues to be limited by financial constraints, especially in order book replenishment.

The group’s current order book stands at RM6 billion, while the non-consolidated order book held by its joint venture and associated entities is valued at RM5.8 billion, representing Sapura Energy’s 50% share.

Sapura Energy remains cash-generative, reporting RM252 million in free cash flow year-to-date, with an unrestricted cash balance of RM1.59 billion as of October 31, 2024. — TMR