Malaysia’s Sapura Energy has bucked the trend of some of its peers by posting its third profitable quarter in this current financial year.
“Sapura Energy pursued an agile strategy of utilising strategic assets to acquire capabilities across the value chain, expanding our global presence and diversifying into adjacent markets,” said Sapura Energy president Shahril Shamsuddin.
“The move steered us through the uncertainties of the energy industry.”
Sapura has executed a “comprehensive optimisation plan” to ensure lean and efficient operations that began started in the last financial year.
The company has already identified more than 200 optimisation initiatives worth 1.1 billion ringgit (US$271.7 million), of which approximately 600 million ringgit-worth have been implemented to date.
These initiatives include improvements in operational productivity, supply chain optimisation and extensive reviews of commercial opportunities within existing contracts.
Meanwhile, Sapura and its financiers are currently finalising terms for a planned refinancing exercise, as part of the group’s capital management programme.
The company said it is confident the refinancing exercise will be completed by January 2021, as scheduled.
The contractor’s order book currently stands at 12.5 billion ringgit with cumulative new orders this year of 2.2 billion ringgit.
Recent awards include the provision of engineering, procurement, supply, construction, installation and pre-commissioning of pipelines for the Al-Khalij field development in Qatar; provision of engineering, procurement, construction, transportation and installation and hook-up and commissioning for the additional Andalas pipeline in the Malaysia-Thailand Joint Development Area; and a drilling services contract for its tender-assist drilling rig Sapura Beranion three wells off Congo.
Sapura on Monday reported third quarter revenues of 1.3 billion ringgit – up 9% on the prior three months - and profit after tax and minority interests of 17 million ringgit, compared to a 101 million loss in the third quarter of the previous financial year.
“The main contributor to revenue growth was the group’s engineering and construction segment, which continued to achieve project milestones despite the challenges of operating a global business during the Covid-19 pandemic,” said Shahril.
“It was important for us to meet clients’ expectations and maintain their trust in Sapura Energy as an agile, professional and reliable partner.”
Sapura earlier this month successfully installed the first monopile at an offshore wind farm in the Taiwan Strait, marking the start of the group’s debut into the offshore wind sector.
Sapura’s current bid book continues to grow, with tenders for oil, gas and renewable energy projects valued at 38.8 billion ringgit submitted and in progress.
“While we anticipate the environment in the oil and gas industry to remain challenging in the short to medium term, the group is optimistic of its ability to navigate the current uncertainties,” added Sapura.
“We will continue to focus on safe and efficient operations across our business segments, deliver our optimisation targets and improve financial strength and be well-positioned to capture opportunities as the market recovers.”
The company’s current financial year runs from 1 February 2020 to 31 January 2021.