KUALA LUMPUR (Sept 30): Cypark Resources Bhd's net profit for the third quarter ended July 31, 2022 (3QFY22) fell 29.2% to RM11.8 million from RM16.68 million a year earlier, dragged down by lower revenue.

Earnings per share declined to 1.37 sen from 2.77 sen, the group's Bursa Malaysia filing showed.

Quarterly revenue dropped 30.9% to RM45.49 million from RM65.92 million on lower contribution from the renewable energy division, whose revenue decreased to RM20.3 million from RM56.2 million.

It is Cypark's weakest quarter by net profit since 2QFY17, when it booked net profit of RM11.61 million or 4.59 sen per share, on revenue of RM83.93 million.

The quarterly revenue performance, meanwhile, was the lowest since 2QFY12, when it booked in revenue of RM43.6 million with net profit of RM7.79 million.

In the quarter, the turnkey contract revenue from the Large Scale Solar 2 (LSS2) projects came down, as one of the LSS2 plants had already been completed earlier this year and another two are at the final stage of completion, said Cypark.

Cypark Ref Sdn Bhd, being the turnkey contractor-cum-financier, will continue to recognise interest revenue as the recurring income for the next 21 years once the secured LSS2 projects move from the construction phase to the operation and maintenance (O&M) phase.

In addition, the group’s 100%-owned subsidiary, Cypark Renewable Energy Sdn Bhd (CRE), has been appointed as the long-term O&M specialist for the LSS2 projects and will also receive O&M revenue as another revenue stream for the next 21 years.

“The group will receive scheduled and confirmed payments agreed with the clients during the said period. The first collection will commence once the client begins to receive payment from Tenaga Nasional Bhd from the sale of renewable energy.

Cypark said revenue from its construction and engineering division fell to RM600,000 compared with RM4.5 million in 3QFY21 as work activities for a newly secured roadwork project were yet to be intensified as a result of the surge in material and labour costs.

The group said its revenue from waste management & waste-to-energy sector increased significantly to RM23.3 million from RM4.3 million in 3QFY21, mainly contributed by the intensive work progress for testing and commissioning as part of the waste-to-energy (WTE) construction as well as the recognition of the additional specialist works which were in its final stage.

“Once the project has achieved commercial operation, the project will move from construction phase to post construction phase, in which the project will start to recognise various recurring income such as waste management fee and sale of 'waste to energy' from its completed integrated WTE plants throughout the concession period,” said Cypark.

The group added that its green tech & environmental services revenue increased to RM1.3 million from RM900,000 in 3QFY21, contributed by the sale of energy from the 1.55MW palm oil mill effluent biogas plant in Kampung Gajah, Perak.

For the nine-month ended July 31 (9MFY22), net profit fell 15.21% to RM42.13 million or 5.41 sen per share, from RM49.69 million or 8.49 sen per share. Revenue slipped 13.08% to RM198.5 million, from RM228.37 million.

Shares of Cypark closed 1.16% lower at 42.5 sen, giving the group a market capitalisation of RM253.5 million.