Southern Score Earnings Growth Remains Resilient Despite Margin Pressure

KUALA LUMPUR: Southern Score Builders Berhad is expected to maintain resilient earnings growth despite ongoing macroeconomic uncertainties and rising cost pressures affecting margins.

The group’s outlook continues to be supported by its sizeable RM1.6 billion outstanding order book, translating into a healthy book-to-bill ratio of 3.5 times based on FY2026 forecast revenue, providing earnings visibility through FY2028.

Analysts also remained positive on Southern Score’s replenishment prospects, driven by expanding opportunities in the data centre segment and recurring project flows from related parties.

Southern Score

Year-to-date contract wins stood at RM456.1 million, entirely contributed by the mechanical and electrical (M&E) segment.

For the third quarter ended March 31, 2026, the group posted a core net profit of RM19.7 million, surging 97 per cent year-on-year and 90.3 per cent quarter-on-quarter.

However, the results were deemed slightly below expectations after nine-month earnings accounted for only 62.7 per cent of full-year forecasts, mainly due to weaker-than-expected margins.

Revenue for the nine-month period jumped 124.2 per cent to RM314 million, supported by accelerated project progress under its SJEE unit.

Despite stronger earnings momentum, analysts revised down earnings forecasts for FY2026 to FY2028 following higher raw material and logistics costs. Nevertheless, a “BUY” recommendation was maintained with a lower target price of 78 sen from 81 sen previously.

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