KUALA LUMPUR (April 10): PhillipCapital has trimmed its earnings forecasts for Southern Score Builders Bhd (KL:SSB8) after near-term project delays caused by a nationwide cement and aggregate supply shortage.

In a note on Friday, the research house said construction progress was temporarily affected during the October-December 2025 period, delaying revenue recognition. However, it stressed the issue was a timing disruption rather than a demand weakness, with supply conditions having normalised since January 2026.

As a result, PhillipCapital cut its financial year ending June 30, 2026 (FY2026) earnings per share forecasts by 2% and 16% for FY2027 and slightly reduced its 12-month target price to 74 sen from 75 sen, based on an unchanged 18 times FY2027 earnings multiple.

Despite the revision, the firm maintained its 'buy' rating, citing upside potential from the stock’s last closing price of 55 sen.

It expects earnings to recover in 2HFY2026 as project activity resumes after cement supply disruptions ease.

Southern Score’s order book remains strong at RM1.6 billion, supported by residential projects (70%), data centre-related jobs (27%), and other works (3%). Its tender book also stands at RM1.4 billion, driven by government buildings, residential developments, and data centre contracts.

PhillipCapital said Southern Score’s long-term outlook remains intact, backed by its growing data centre exposure through its 51%-owned subsidiary SJEE Engineering Sdn Bhd.

Key catalysts include a potential RM900 million hyperscale data centre project in Port Dickson expected to go to tender in 3Q2026, along with further expansion works from existing clients that could lift its pipeline by over RM1.2 billion. The group also expects a RM180 million hospital contract (Radium Hospital) by mid-2026, supporting earnings visibility through FY2029.