Auditor flags going concern for Sapura Energy
KUALA LUMPUR: Sapura Energy Bhd 's external auditors Messrs. Ernst & Young PLT (EY) issued an unqualified audit opinion with a material uncertainty related to going concern in the independent auditors' report for the financial year ended Jan 31, 2025.
In a filing with Bursa Malaysia, Sapura Energy said its auditor highlighted that the group's current liabilities exceeded its current assets by RM11.2bil and RM4.3bil respectively, and noted that the group is facing severe liquidity constraints.
Nevertheless, EY said 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 on March 11, 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.
In a separate statement, Sapura Energy said 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% approval from relevant scheme creditors in the court convened meetings.
'Over the years, Sapura Energy 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,' it said.
Sapura Energy is currently preparing the circular in relation to the proposed regularisation plan for submission to Bursa in May 2025 and anticipates that the restructuring effective date will be achieved by August 2025 or latest by the longstop date.
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