SEB Releases Audited FY2025 Financials, Shows Improved Financial Performance Amidst Restructuring Progress

Sapura Energy Berhad (“SEB” or “the Company”) and its group of companies (“the Group”) today announced its Audited Financial Statements for the financial year ended 31 January 2025 (“FY2025”), confirming the Group’s first return to profitability in six years.

The Group’s Profit After Tax and Minority Interest (“PATAMI”) in FY2025 stood at RM190 million, an improvement from the Loss After Tax and Minority Interest (“LATAMI”) of RM509 million it recorded in the previous year. FY2025 revenue stood at RM4.7 billion, increasing by 8.9 percent or RM385 million year-on-year, while the Group’s Earnings Before Interest, Tax, Depreciation, and Amortisation (“EBITDA”) stood at RM524 million.

The FY2025 Audited Financial Statements was accompanied by an unqualified audit opinion from its External Auditors, Messrs. Ernst & Young PLT (“EY”). In its report, the auditors stated that SEB’s annual financial statements for the Group and the Company were prepared on a going concern basis; but noted the existence of a material uncertainty related to going concern as current liabilities of the Group and of the Company exceeded their current assets; and that the Group is facing severe liquidity constraints.

Nevertheless, the financial statements of the Group and of the Company have been prepared on a going concern basis, the validity of which is highly dependent on the timely approvals, execution and completion of the Proposed Regularisation Plan on or before the Long Stop Date (i.e. 11 March 2026), which is necessary for the Schemes of Arrangement (“SOA”), the Conditional Funding Agreement and the commercial settlements related to terminated Engineering & Construction (“E&C”) projects to take effect within the stipulated timeframe.

Previously, in financial years 2022, 2023 and 2024, the External Auditors also flagged material uncertainty related to going concern in the Group and the Company’s financial statements. The material uncertainty included, amongst others, extensions of restraining orders, achieving favourable outcomes of the legal claims for terminated E&C projects and the successful and timely implementation of the proposed SOA with at least 75 percent approval from relevant scheme creditors in the court convened meetings

Over the years SEB has been able to achieve these critical milestones, enabling the Group to proceed with the finalisation of its proposed regularisation plan, with a target to submit to Bursa Malaysia in May 2025. These key milestones include:

·         Successful Divestment of SapuraOMV: The Company completed the sale of its 50 percent equity in SapuraOMV Upstream Sdn. Bhd. in December 2024, with the disposal proceeds to be utilised primarily to reduce debt.

·         Schemes of Arrangement approved by relevant Scheme creditors: Between 21 February and 27 February 2025, various classes of creditors (collectively, the “Scheme Creditors”) of Sapura Energy and 22 of its subsidiaries (collectively, the “Scheme Companies”) approved the proposed SOA between the Scheme Companies and their respective Scheme Creditors as part of its debt restructuring plan.

·         Progress in Contract Settlements: The Group reached conditional settlements for several legacy E&C contracts, further supporting its cash flow position.

·         Court Sanction Secured: On 6 March 2025, the High Court of Malaya in Kuala Lumpur sanctioned the SOA involving the Company and 22 subsidiaries; and granted an interim relief providing protection against legal action or proceedings during the restructuring period and allowing the Company to proceed with implementing its plans. The Sanction Date for the SOA was 11 March 2025.

·         Strategic Investment Secured: On 4 March 2025, the Company signed a Conditional Funding Agreement (“CFA”) with Malaysia Development Holding Sdn. Bhd. (“MDH”) for up to RM1.1 billion in investment through subscription of Redeemable Convertible Loan Stocks. The funding will only be utilised to settle liabilities with Malaysian vendors in the oil and gas sector.

Regularisation Plan Progressing: The Company is finalising its Proposed Regularisation Plan to regularise its financial condition. The submission of the Proposed Regularisation Plan to Bursa Malaysia is targeted in May 2025.

In a filing with Bursa Malaysia, the Board stated its confidence in the Group’s forward path, noting that the successful delivery of key restructuring actions provides a strong foundation for completing the plan.

The FY2025 Audited Financial Statements will be included in SEB’s Annual Report, expected to be published by 31 May 2025.