PETALING JAYA: Malakoff Corp Bhd
, through its sub-subsidiary, Alam Flora Environmental Solutions Sdn Bhd (AFES), awards a RM26.85mil contract to MMC Engineering Sdn Bhd, a related party of Malakoff, to carry out construction works for the Sustainable Facility and Eco-Park Centre (SAFE-T) at Teluk Kalong in Kemaman, Terengganu.
Under the related-party transaction, MMC Engineering has been appointed as the Work Package Construction 2 contractor for the facility, the company said in a filing with Bursa Malaysia.
The construction period is expected to be 15 months from the commencement date, which has yet to be stipulated.
The announcement comes amid analyst expectations that Malakoff will see a performance turnaround in the second half of financial year 2026 (2H26), as the operational outages in its Tanjung Bin Power (TBP) plant which dragged on its second quarter earnings are now nearly behind it.
In the second quarter ended June 30, 2026 (2Q26), the group recorded a net profit of RM31.71mil, marking almost a 50% year-on-year (y-o-y) decline from RM62.83mil last year, largely due to lower contribution from its TBP plant.
The TBP plant had been impacted by steam turbine generator rotor failure in its Unit 30 and generator hydrogen cooler leakage in its Unit 20.
Following softer-than-expected 2Q26 results, CIMB Research cut its core net profit (CNP) forecasts for the financial year 2026 (FY26), FY27 and FY28 by 16%, 1%, and 1%, respectively.
“We now project Malakoff’s FY26 CNP to grow by 100% y-o-y (FY25: minus 75% y-o-y), with CNP to improve sequentially across 3Q26 and 4Q26,” it said.
It noted that operations at TBP and Tanjung Bin Energy have largely normalised, and now operate close to their full generating capacity, in addition to the coal handling system at the Tanjung Bin Complex also fully restored to its design capacity of up to 5,000 tonnes per hour.
CIMB Research anticipates the group’s CNP fully recovering in FY27, before easing by 10% y-o-y in FY28 on reduced energy income margin and the expiry of Al Hidd’s concession.
It maintained its “hold” rating on the stock, lowering its target price by 8% to 92 sen.
The research house further opined that Malakoff currently lacks a near-term re-rating catalyst in the form of large new project wins.
Kenanga Research, on the other hand, kept its “outperform” call on Malakoff, with a slightly trimmed target price of 99 sen from RM1 previously.
“The key re-rating catalyst hinges on incoming independent power producer (IPP) contract awards, which should reinvigorate medium-term growth momentum after years of power purchase agreement (PPA) expiry drag,” it said.
After adjusting for the outages, the research firm cut its FY26 earnings forecast by 19%, but left its FY27 projections unchanged.
“With orders for four 700-megawatt gas turbines placed, the group is well-positioned in the longer-term to secure new IPP capacity to meet surging demand from data centre expansions,” it said.
Elsewhere, TA Research highlighted the group’s upcoming PPA extensions for its GB3 and SEV plants andthe commencement of its Prai Power’s extension in April 2026, which it projects will altogether enhance earnings by up to 17%.
It retained its “buy” recommendation, as well as its target price of RM1.26.
