BIMB Research expects Cypark’s earnings quality to improve gradually as depreciation intensity normalises and finance costs stabilise.
PETALING JAYA: Renewable energy firm Cypark Resources Bhd
, which disclosed its second-quarter results ended Oct 31, 2025 (2Q26), on Tuesday, is expected to post near-term losses amid a gradual improvement in earnings derived from various projects over the next year or two, says BIMB Research .
The company reported a loss of RM15.5mil for 2Q26, against a net profit of RM2.3mil in the corresponding quarter of the previous financial year ended April 30, 2025 (FY25).
Revenue declined to RM46.2mil from RM49.1mil a year ago.
“While near-term reported losses are likely to persist, underlying cash flow strength and improving operational momentum provide downside support,” the research house said, noting that earnings visibility would be supported by a RM3.5bil tender book.
It said there could be a potential conversion of RM2.2bil from these bids over the next 12 to 24 months across solar engineering, procurement, construction and commissioning (EPCC), integrated solar-battery energy storage system (Bess) and waste-to-energy (WTE) projects.
“Combined with recurring income from operational assets, we expect Cypark’s earnings quality to improve gradually as depreciation intensity normalises and finance costs stabilise,” it said.
While the company’s circular waste and WTE segment recorded strong sequential recovery in 2Q26, the earnings miss was driven by timing mismatches in EPCC revenue recognition due to the completion of the Rawang hospital project and limited recognition from solar-Bess and large-scale solar five plus jobs.
Core losses narrowed quarter-on-quarter mainly due to improved asset utilisation following the resumption of WTE operations.
BIMB Research has placed its recommendation “under review”, with the last target price at 99 sen.
The stock ended yesterday’s trading up 2.9% to 71 sen.
