KUALA LUMPUR: Uzma Berhad is anticipated to acquire more contracts with higher revisions as a significant beneficiary of growing brownfield activities, according to Public Investment Bank Bhd (PublicInvest).
It also said that notwithstanding recent moderations in oil prices, the upward revision in contract value reinforces its positive outlook on the trajectory of the capital spending plans of the oil producers.
However, the investment bank anticipates that the financial performance for the approaching third quarter of the fiscal year 2023 (3QFY23) would be flat or slightly lower on a quarter-over-quarter (q-o-q) basis.
"This is due to the monsoon season during the period, with 3Q usually the weakest quarter for its financial year. We believe the higher revision in some contract values could offset the decline on a q-o-q basis, however," it said in a note today.
Uzma's wholly-owned foreign subsidiary in Thailand, MMSVS Group Holding Co Ltd yesterday had secured a contract worth RM45 million from Valeura Energy Inc for the provision of coil tubing services.
PublicInvest said assuming a net profit margin of seven per cent, this project is expected to contribute RM3.1 million to the company's bottom line, spreading over FY24 to FY26.
The bank has maintained its forecast unchanged nonetheless, having assumed this contract as part of its replenishment assumption.
PublicInvest also said Valuera Energy is the largest independent oil producer in Thailand after the recent acquisition of Mubadala Petroleum's assets in March 2023 including Block B5/27 (Jasmine and Ban Yen oilfields).
To recap in February 2020, Uzma secured a contract for similar services worth RM23 million with three plus two years extension from Mubadala Petroleum's MP B5 (Thailand) Ltd.
"With the upward contract revision, we are positive on this development as it also demonstrates Valeura Energy's confidence as the new owner of the oilfield and validates Uzma's strong track record in delivering valued services for the previous contract," it said.
