RESEARCH FIRMS LOWER YINSON EARNINGS OUTLOOK

KUALA LUMPUR, March 25 (Bernama) -- Kenanga Research has decreased the earnings forecast for Yinson Holdings Bhd for the financial year 2025 by 2.0 per cent after accounting for a slightly higher loan balance assumption.

In a note today, the research firm said it also introduced the financial year 2026 forecast earnings of RM617 million, which assumes a full-year contribution from floating, production, storage and offloading (FPSO) vessel Maria Quiteria.

Last week, Yinson said in a Bursa Malaysia filing that their increase in profit was mainly due to the higher contribution from the group’s engineering, procurement, construction, installation and commissioning (EPCIC) business activities and the fresh contribution from FPSO Anna Nery’s operations since first oil was achieved on May 7, 2023.

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“We reduced our target price (TP) by 1.0 per cent to RM3.41 from RM3.44. Note that our TP reflects a five per cent premium given a 4-star environmental, social and governance (ESG) rating as appraised by us,” Kenanga Research said.

Kenanga Research said that it continues to favour Yinson due to a strong FPSO order book pipeline with multiple major FPSO jobs under the conversion stage, which provides significant earnings growth in the coming years.

“Strong project execution track record positions the company to benefit from strong structural demand for FPSO contractors anticipated in the coming years, and it being one of the first local oil and gas companies investing in green technology companies (such as solar, e-mobility, among others) which, in our view, would help with the company’s long-term energy transition agenda,” it said.

The research firm maintained an ‘outperform’ call for Yinson.

Meanwhile, RHB Investment Bank Bhd said that it cut Yinson’s financial year 2025-2026 earnings by 12 per cent to impute higher finance and operating costs. 

“Our TP is lowered to MYR2.96 (including a two per cent ESG premium) post the latest net debt update and earnings adjustments. 

On downside risks, Yinson was unable to win new jobs and contract terminations,” it added.

At 2.06 pm, Yinson shares rose by 1.0 sen to RM2.46, with 1.87 million units traded.

-- BERNAMA