KUALA LUMPUR (June 4): All indicators point to a positive outlook for Sapura Energy Bhd for the current financial year ending Jan 31, 2022 (FY22) as the oil and gas (O&G) support services provider has already secured about 80% of its targeted revenue for FY22, and that the company continues to win more work despite lingering concerns over the economic impact of the Covid-19 pandemic, according to Sapura Energy chairman Tan Sri Shamsul Azhar Abbas.

Shamsul said in Sapura Energy’s latest annual report, which was filed with Bursa Malaysia today, that the company is cautiously optimistic that the theme for FY22 is global economic recovery.

"Many countries have deployed their vaccination programmes against Covid-19 and immunisation is expected to pick up momentum globally, reviving economic activities and energy demand.

"We foresee that a return of energy demand will lead to improved fuel prices, and ultimately restore capital spending in the [O&G] sector. Nevertheless, we acknowledge Covid-19 will continue to be a primary concern until we achieve herd immunity,”  said Shamsul, who is a former Petroliam Nasional Bhd (Petronas) president and group chief executive officer (CEO).

Moving forward, Shamsul said Sapura Energy expects to present better financial results for FY22 as it continues the trajectory of improvement in the last few quarters. 

The group’s fundamentals remained strong, according to him.

“It (Sapura Energy) continues to make good progress in streamlining its cost structure. The impairment test done indicated both the E&C (engineering and construction) and drilling portfolios remain robust. 

"The completion of its (Sapura Energy's) refinancing exercise and availability of additional working capital facilities assure that the group remains competitive to pursue new projects in a recovering market. 

"Its addressable market has increased significantly, with increasing opportunities in the offshore wind sector. More success in the renewable segment bodes well for the group as it embraces the energy transition,” he said.

Meanwhile, Sapura Energy's exploration and production segment under the SapuraOMV Upstream joint venture (JV) remains focused in its shift towards more gas developments, according to Shamsul.

He claimed that Sapura Energy is a major supplier and the lowest unit cost producer of gas to Malaysia LNG Sdn Bhd plants in Bintulu, Sarawak, and this position will be further strengthened following the final investment decision taken on Sapura Energy's Jerun O&G field, the company’s largest project within the SK408 field offshore Sarawak.

"All indicators point to a positive outlook for FY22, and the [Sapura Energy] board is confident of the group's improved performance in the upcoming year," he said.

SapuraOMV is a strategic partnership between Sapura Energy and OMV Exploration & Production GmbH, a subsidiary of Austria-based OMV Aktiengesellschaft, according to OMV's website.

At Bursa's 12.30pm break today, Sapura Energy's share price settled unchanged at 13 sen, with a market value of about RM2.08 billion.

Sapura Energy has 15.98 billion issued shares, according to its latest annual report.