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KUALA LUMPUR: Tan Sri Shahril Shamsuddin, the president and group chief executive of Sapura Energy Bhd
, has slipped out of the billionaire list after the company’s wider-than-expected losses in the third quarter sent the stock crashing below RM1 for the first time since the merger with Kencana Petroleum Bhd in 2012.
Shahril controls a billion shares in Sapura Energy, mainly through his substantial stake in Sapura Holdings Sdn Bhd, the company’s single largest shareholder.
The 56-year-old, earlier this year, was ranked at 29 among Malaysia’s richest on the list complied by StarBiz with an estimated net worth of RM1.76bil.
The bulk of his fortune is tied to his 16% stake in Sapura Energy. The stock’s sharp 40% decline since January had vastly eroded his net worth.
Shares in Sapura Energy fell 20% on Wednesday to close at 96.5 sen after the company reported a wider-than-expected loss in the third quarter ended Oct 31.
At its peak in 2014, Sapura Energy had a market capitalisation of about RM30bil. At current market price, the company’s value has dwindled to RM5.8bil.
But another billionaire shareholder in Sapura Energy, Tan Sri Mokhzani Mahathir, has had better luck.
About a month ago, Mokhzani ceased to be a substantial shareholder in Sapura Energy after he hived his stake in the company to less than 5% following the disposal of 385 million shares.
At that time, Sapura Energy shares were traded at RM1.50 each, more than a third higher than what it is now.
Prior to the sale, Mokhazani owned 605 million shares in Sapura Energy. It was reported that he was looking to dispose of all his shares in Sapura Energy as part of a broader strategy to exit the industry.
Mokhzani had been reducing his shares in Sapura Energy since 2014 — months before the oil market collapsed.
The first sale in April that year was done at RM4.30 a piece.
In 2013, Mokhzani and his business partner Datuk Yeow Kheng Chew, better known as K.C. Yeow, left the board of Sapura Energy.
Mokhzani and Shahril were seen as the twin pillars that made the then SapuraKencana into a giant oil and gas company during the days of prices hovering above US$100.
In 2012, the two friends merged their businesses, Kencana Petroleum Bhd and SapuraCrest Petroleum Bhd, to form what was the biggest privately-owned integrated O&G company in the country.
Last year, Sapura Energy saw the exit of Seadrill Ltd as a shareholder when the Norway and US-listed company sold its remaining 8.2% stake.
Seadrill is controlled by billionaire John Fredriksen. The company, in October, filed for bankruptcy last month in a bid to shrink its own debt burden.
Meanwhile, Sapura Energy’s latest quarterly results show that debt level remains high at RM18bil.
Another concern is that its cash position has dwindled by about RM1bil to RM1.89bil as of the end of October.
Shahril said the challenging operating environment is expected to persist in the short and medium term.
“The group is currently considering various strategic and operational plans to mitigate the impact and improve the group’s competitive position,” he said in a statement yesterday.
The company on Wednesday said it made a loss of RM274bil in the three months ended Oct 31 as revenue slumped 40% amid a slowdown at its engineering, construction and drilling businesses.
This is the group’s first quarterly losses for the fiscal period ending Jan 31, 2018 (FY18), but the worst in 18 months.
The losses, according to one analyst, was “unexpectedly huge.”
The dismal performance in the third quarter pushed Sapura Energy deep into the red with a loss RM218mil for the nine-month period.
The market, prior to the release of the group’s latest quarterly results, had predicted a net profit of RM85mil for the full year, consensus estimates showed.
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