KUALA LUMPUR (March 25): CIMB Securities Equities Research has maintained its “buy” rating on Yinson Holdings Bhd at RM2.45 with a lower target price (TP) of RM2.94 (from RM3) and said Yinson's fourth quarter of financial year 2024 (4QFY2024) core net profit decreased by 20.1% quarter-on-quarter (q-o-q) to RM227 million.

In a note on Monday, the research house said this brought FY2024 core net profit to RM944 million (up 35.3% year-on-year) driven by higher engineering, procurement, construction, installation, and commissioning (EPCIC) revenue, contributed by floating production storage and offloading (FPSO) vessels Agogo and Atlanta.

“This was above our expectations as we had earlier assumed zero contribution from EPCIC, though in line with consensus at 98%.

“Final DPS (dividend per share) was kept at one sen, bringing FY2024 DPS to three sen (FY23: two sen), below our forecast of 4.4 sen,” it said.

CIMB Securities said post-4QFY2024 results, the research house raised core net profit for FY2025 by 34% to incorporate the balance of EPCIC works but kept it relatively unchanged for FY2026 as it had assumed no further EPCIC works on new FPSO vessels.

Core net profit to decline

“Overall, we anticipate Yinson's FY2025-2026 core net profit to decline at a two-year CAGR (compound annual growth rate) of 12%, primarily due to a drop in EPCIC contribution, partly offset by production contributions from FPSO Atlanta and Maria Quiteria.

“Maintain 'buy' with SOP (sum of parts)-based TP lowered by 2% to RM2.94,” it said.