PETALING JAYA: Cypark Resources Bhd ’s earnings growth will be underpinned by its renewable energy (RE) segment from waste-to-energy facilities in Ladang Tanah Merah, according to PublicInvest Research.
The facilities are set to be commissioned after the second half of FY19.
The research house said it also expected further contributions in the RE segment once the 30MWac of floating solar in Empangan Terip, Negri Sembilan is completed.
Cypark, which announced its fourth quarter results on Monday, recorded an 11% increase in net profit to RM20.18mil.
This was on the back of year-on-year (y-o-y) revenue also rising by a larger quantum of 24% to RM79.66mil.
The group’s full-year net profit increased 22% to RM70.4mil, attributed to the absence of the employee stock option scheme (ESOS) expenses of RM5.2mil recognised during the previous financial year.
PublicInvest Research, in its note, said the group’s earnings were slightly above its and consensus expectations, accounting for 109% and 106% of net profit estimates respectively.
“It is higher than our forecast due to higher-than-expected cost of sales,” it said.
The research house kept its forecasts unchanged, while adjusting its target price to RM1.60.
In its filing with the stock exchange on Monday, Cypark had said its profits rose due to improved performance in the landscaping and infrastructure division and the green tech and renewable energy business segment.
The green tech and renewable energy space, it said, were mainly supported by cost efficiency achieved in its operations and continuous savings achieved in finance costs.
Moving forward, the group noted that it would continue to enhance its resources in research and development in the environmental engineering, green technology, and renewable energy space.
The stock rose four sen or 2.53% to close at RM1.62 yesterday.