Kuala Lumpur, 26 September 2022
Summary of Q2 FY2023 financial results:
- Revenue of RM1.17 billion
- EBITDA of RM313 million
- LATAMI of RM3 million
Sapura Energy Berhad (“Sapura Energy”) and its group of companies (“the Group”) announced results for the second quarter of financial year 2023 (“Q2 FY2023”), recording positive earnings before interest, taxes, depreciation, and amortisation (“EBITDA”) of RM313 million, and revenue of RM1.17 billion.
The Group posted RM3 million loss after tax and minority interests (“LATAMI”), mainly due to its share of a well write-off and impairment recognised by its Exploration & Production (“E&P”) strategic partnership SapuraOMV Upstream.
In the preceding quarter (“Q1 FY2023”), the Group posted a profit after tax and minority interests (“PATAMI”) of RM 92 million, and EBITDA profit of RM250 million on the back of RM886 million revenue.
In the corresponding quarter last year (“Q2 FY2022”), the Group recorded a LATAMI of RM1.5 billion, and an EBITDA loss of RM1.17 billion on the back of RM747 million revenue.
Sapura Energy’s Q2 FY2023 EBITDA performance is mainly attributable to commercial settlements from certain contracts in its Engineering & Construction (“E&C”), materialisation of additional claims in Operations & Maintenance (“O&M”), and improved rig utilisation and day rates in its Drilling business segment. The Group’s E&C business segment continues to be under challenge by the current operating landscape.
Despite the challenges, all business segments registered positive EBITDA, with E&C delivering RM38 million; O&M delivering RM47 million; and Drilling delivering RM150 million.
PROGRESS IN RESET PLAN
“We are encouraged by our financial performance this quarter, as it indicates early results in our Reset Plan and we are on the mend. Clearly, the game-changer in our future growth is the reduction of unsustainable debt, which we are working hard to resolve with all stakeholders,” said Sapura Energy Group CEO Datuk Mohd Anuar Taib.
Sapura Energy recently sought assistance from the Corporate Debt Restructuring Committee of Malaysia (“CDRC”), a committee under the purview of Bank Negara, to mediate its debt restructuring negotiations with lenders. CDRC has accepted Sapura Energy’s application and the Group is expected to submit a proposal for a restructuring of its debts within 60 days from September 1.
As part of portfolio rationalisation, the Group recently completed the divestment of its heavy lift pipe laying vessel Sapura 3000 and entered into a memorandum of agreement (“MOA”) for the disposal of three drilling rigs.
The Group is also making progress in its proposed scheme of arrangement (“SOA”). Sapura Energy and 22 of its wholly-owned subsidiaries are completing the verification of claims submitted by its creditors under the proof of debt exercise.
Initiated in December 2021, the Group’s Reset Plan aims to create long-term sustainability by rebuilding the Group’s balance sheet, enhancing its operational and risk management framework, and charting future business direction.
Under the Reset Plan, the Group’s business segments refocused its bid funnel based on capabilities and risk appetites, while enhancing project management discipline. The Group is currently executing close to 90 projects globally, nine of which commenced in the Q2 FY2023, and completed 18 projects in the same quarter. Its order book to-date stands at RM7.7 billion.
Cautionary note: “Sapura Energy”, “the group” and “the company” are used for convenience where references are made to Sapura Energy Berhad in general. Similarly, words like “we”, “us” and “our” are used to refer to Sapura Energy Berhad in general or to those who work for the company and its subsidiaries, where relevant. This press release may contain forward-looking statements. All statements other than statements of historical facts included in this press release, including, without limitation, those regarding our financial position, financial estimates, business strategies, prospects, plans and objectives for future operations, are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements, or industry results to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding our present and future business strategies and the environment in which we will operate in the future. Such forward-looking statements reflect our current view with respect to future events and are not a guarantee of future performance. Forward-looking statements can be identified by the use of forward-looking terminology such as the words “may”, “will”, “would”, “could”, “believe”, “expect”, “anticipate”, “intend”, “estimate”, “aim”, “plan”, “forecast” or similar expressions and include all statements that are not historical facts.