KUALA LUMPUR: There could be a delay in the commercial operation date (COD) of Cypark Resources Bhd's large solar scale (LSS) 2 and LSS3 projects.
PublicInvest Research noted that although Cypark retained its completion date for the LSS2 Danau Tok Uban and LSS3 Merchang plants by December 2023, it has yet to declare the COD.
"Therefore, we do not discount slight delays in the completion date, although it has resumed active progress on both of the projects after injection in funding from its new major shareholders via a perpetual sukuk," it said in a note today.
Cypark Resources saw an increase in net losses from its waste-to-energy (WTE) segment in the second quarter of its financial year 2024 (Q204), as a result of lower sales of green energy brought on by a plant outage that necessitated maintenance during the period. The net loss from this segment was RM4.8 million in Q204.
The company's net loss for the first half of the 2024 fiscal year was RM7.2 million, which was less than the full-year net profit expectations of RM20.3 million and RM19.7 million, respectively, both set by the firm and the consensus.
"On these notes, we revise our forecast for FY24 to a net loss of RM9.3 million to reflect the WTE plant outage and potential delays in the commercialisation of the LSS2 and LSS3 plants.
"We also lower our forecasts for FY25 and FY26 by 49 per cent and 24 per cent respectively, for delayed plant optimization," it noted.
It maintained a "neutral' call on the stock with a lower target price of 86 sen from 90 sen previously.