KUALA LUMPUR (Dec 17): Cypark Resources Bhd’s (KL:CYPARK) near-term reported losses are likely to persist, said BIMB Securities, as slow construction segment earnings recognition led to missed estimate in the latest reporting season.
Cypark's weaker-than-expected first half ended Oct 31, 2025 (1HFY2026) was partly due to solar construction jobs which were "back-end loaded with limited second-quarter recognition", said BIMB Securities in a note.
The renewable energy asset developer could see gradual improvement in earnings quality as "depreciation intensity normalises and finance costs stabilise", and as its waste-to-energy plant, which resumed operations in the second quarter, provides cash flow strength, the house said.
"Importantly, the waste-to-energy segment remained cash-generative and continues to play a strategic role in Cypark’s long-term growth, with Phase 2 expansion of the SMART WTE facility now approaching final approval," it said.
Cypark posted core net loss of RM51.2 million in 1HFY2026, BIMB Securities said, although second-quarter core net loss narrowed to RM23.9 million on the WTE asset resumption.
The group has a RM3.5 billion tender book and targets to secure RM2.2 billion of that in the next two years.
BIMB Securities’ investment call on the stock is currently under review pending analyst coverage reassignment, with Cypark shares last traded at 69 sen on Tuesday, valuing the group at about RM674.7 million.