Shares jump by 19% as company reports positive earnings

  • Velesto Energy shares rose by as much as 19% after swinging to a profit in the fourth quarter
  • Shares are on track for their biggest one-day percentage gain in a year
  • Fourth-quarter net profit was MYR66.68 million, compared to a net loss of MYR26 million a year ago
  • Improved asset utilization, higher charter rates, and better work progress drove the profit swing
  • Velesto may sustain its growth momentum with higher daily charter rates by securing new contracts or renewing existing contracts
  • Elevated crude oil prices could result in continued tight supply of jack-up rigs over 2024 and 2025
  • Kenanga Investment Bank upgraded Velesto’s stock rating to outperform, citing a positive outlook for the Malaysian jack-up rig market

Velesto Energy shares experienced a significant surge after the company announced a swing to profit in the fourth quarter. The shares rose by as much as 19% on Wednesday morning, marking their biggest one-day percentage gain in a year. Velesto reported a net profit of MYR66.68 million for the fourth quarter, a significant improvement compared to the net loss of MYR26 million in the same period last year. The positive results were driven by improved asset utilization, higher charter rates, and better work progress. Analysts predict that Velesto will continue its growth momentum by securing new contracts or renewing existing contracts with higher daily charter rates. Additionally, the elevated crude oil prices are expected to result in a tight supply of jack-up rigs over the next few years, leading to a positive outlook for the Malaysian jack-up rig market. As a result, Kenanga Investment Bank upgraded Velesto’s stock rating to outperform.

Factuality Level: 8
Factuality Justification: The article provides specific details about Velesto Energy’s financial performance, including profit figures, revenue growth, and analyst forecasts. The information is presented objectively without sensationalism or bias. The article does not contain irrelevant information or misleading details, making it a reliable source of factual information.
Noise Level: 3
Noise Justification: The article provides relevant information about Velesto Energy’s financial performance, including details on their profit, revenue, and future growth prospects. It also includes insights from analysts on the company’s outlook. The information is focused, supported by data, and offers actionable insights for investors interested in the energy sector.
Financial Relevance: Yes
Financial Markets Impacted: Velesto Energy
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article pertains to the financial performance of Velesto Energy, a Malaysian energy-services provider. It discusses the company’s swing to profit in the fourth quarter and the factors driving its improved performance. There is no mention of any extreme event or its impact.
Public Companies: Velesto Energy (N/A)
Key People: Jeremie Yap (Analyst at Maybank Investment Bank), Lim Sin Kiat (Analyst at Kenanga Investment Bank)

Reported publicly: www.marketwatch.com