The scope of the new job is to provide repair and maintenance of access roads and slope stabilisation works within Right of Way (ROW) of Sabah Sarawak Gas Pipeline (SSGP) project for the Sarawak portion.
KUCHING: TRC Synergy Berhad via its wholly-owned subsidiary company, Trans Resources Corporation Sdn Bhd, has been awarded by PETRONAS Carigali Sdn Bhd a contract worth RM61.6m.
The new job, which is the group’s third picking for the year, is mainly for infrastructure works located in Sarawak. The project is estimated to yield circa RM4 million in net profit during the construction period.
Analysts at Public Investment Bank Bhd (Public Research) made no change to its earnings estimates as it had assumed a contract win of RM350 million for financial year 2015 (FY15).
“As indicated earlier in our earlier report, the group is eyeing smaller jobs now, and the jobs secured so far are mostly below the RM100 million mark and has accumulatively clinched jobs worth about RM176 million,” it detailed yesterday.
“The reason was to improve margins and better control of costs with smaller scale jobs. Our target replenishment for this financial year remains at RM350 million.”
To note, the scope of the new job is to provide repair and maintenance of access roads and slope stabilisation works within Right of Way (ROW) of Sabah Sarawak Gas Pipeline (SSGP) project for the Sarawak portion.
The contract is expected to take two years, effective from Sept 10, 2015 until Sept 9,r 2017, with the option to extend for an additional year until Sept 9, 2018.
TRC Synergy’s outstanding orderbook is estimated to be in excess of RM1.2 billion with the new job win, the research house said, which should underpin the group’s earnings for the next two years.
“”We maintain neutral and a target price of RM0.34. With the weak sentiment currently, we do not see any catalyst for the stock in the near term. That said, we are comforted by the earnings recovery progress so far after a string of losses.
“However, we are still of the view that until there’s stabilization in the Group’s earnings, we would prefer to take a conservative stance and monitor the earnings for further signs of recovery before we review our stance on the stock.”