PETALING JAYA: T7 Global Bhd
’s second Pan Malaysia contract win has strengthened its earnings prospects, supported by its sizeable order book with long-term earnings visibility.
Assuming a 9% net profit margin, the contract is expected to generate an annual profit after tax of RM5mil-RM7mil over 2025-2029 for T7 Global, which represents 10%-13% of Phillip Research’s 2025 earnings forecast.
The research house believes the contract value is lower than the previously awarded ExxonMobil Package B2 (Guntong).
It estimates the value to be in the “range of RM300mil-RM400mil, which would imply an annual revenue of RM60mil-RM80mil”.
Notably, this marks T7 Global’s second Pan Malaysia package win, bringing the group’s total outstanding order book to an estimated RM3.5bil.
“We expect continued positive flow of contract awards in the coming weeks, with only six of the 18 available hookup commissioning and maintenance, construction and modification Pan Malaysia packages announced to date,” it said in a report.
No changes were made to its earnings forecast as this contract win falls within the order book replenishment assumptions.
Phillip Research reiterated its “buy” call for the stock, with a target price of 68 sen per share, which implies an 11 times forward 2025 earnings per share.
Key risks to its call include unforeseen operational delays in existing mobile offshore production unit, the baggage handling system project and work orders, and higher-than-expected operating costs.
