KUALA LUMPUR (Jan 2): Cypark Resources Bhd (KL:CYPARK) is expected to stay in red with a larger than previously expected core net loss for the current financial year, before a turnaround for the renewable energy company, analysts said.
After excluding one-off items, Cypark racked up a loss of RM55 million for the six months which exceeded the full-year consensus estimate of RM34 million. Maybank Investment Bank now expects Cypark to make RM54 million in core net loss for the year ending April 30, 2025 (FY2025).
Still, the research house expects Cypark’s earnings to improve in the second-half of FY2025.
The large-scale floating solar project in Danau Tok Uban, Kelantan, is set to achieve commercial operation in January or February this year, providing scheduled and confirmed payments from Tenaga Nasional Bhd (KL:TENAGA) for electricity sales, it noted.
Shares of Cypark have declined more than 8% last year, as the company grappled with three consecutive quarters of losses before its return to the black in the latest quarter, on the back of a one-off RM30 million reversal on a provision.
Analysts however see little change in the share price for the company, with a RM716 million market capitalisation. All three research houses rate Cypark as “hold”, with an average target price of 85 sen, implying a potential decline of 2% from its last price in the next 12 months.
Apart from the Kelantan solar project, Public Investment Bank also expects Cypark to turn around in FY2026, and projects a core net profit of RM15.3 million, driven by its waste-to-energy segment.
Cypark’s waste-to-energy plant in Negeri Sembilan had been affected by prolonged downtime following a fire incident, though losses for the segment narrowed by 45%, with anticipated compensation from insurance coverage.
Further, the segment is expected to improve significantly with a full-quarter recovery, the research house noted.
“Notably, the company no longer has delayed solar projects in hand, and [is] able to fully focus on its next growth projects, moving forward,” BIMB Securities said.