UALA LUMPUR: Tenaga Nasional Bhd
(TNB) posted lower earnings of RM6.12bil in the financial year ended Aug 31, 2015 due to the weaker ringgit which has depreciated by about 23% against the US dollar since January this year.
The power giant announced on Thursday its earnings fell by 5.4% from RM6.46bil in FY14. Despite the decline, it maintained its dividend payout of 19 sen a share for the fourth quarter.
TNB reported a forex translation loss of RM819.30mil and transaction loss of RM113mil in FY15 compared with a forex translation gain of RM445.30mil and transaction gain of RM3.6mil in FY14.
“Given the impact of the slowdown in the global economy, including declining commodity prices, depreciation of the ringgit and expected slower growth in major advanced economies, the board continues to remain cautious on the group’s prospect for FY2016,” it said.
TNB said at the operating level, its operating profit was higher at RM8.627bil compared with RM7.181bil a year ago. Revenue was slightly higher at RM43.28bil compared with RM42.79bil.
For the fourth quarter ended Aug 31, 2015, its earnings were lower at RM820.90mil – down by 39.4% from the RM1.356bil a year ago.
The weaker earnings were due to forex translation loss of RM733.50mil and transaction loss of RM25.90mil compared with the translation gain of RM153.1mil a year ago. Earnings per share were 14.55 sen compared with 24.03 sen.
Commenting on the FY 15 financial performance, it continued to have high investment in capex this financial year at RM10.8bil as compared to RM10bil invested last year. Approximately 50.0% of the capex was spent towards ensuring system efficiency, security and reliability through investments in system maintenance and enhancements.
The remaining of the capex was spent on generation projects towards meeting future capacity requirement of approximately 4,100 MW. One of the projects, Manjung 4 with capacity of 1,010 MW was successfully commissioned on April 14, 2015.
Operating expenses for FY2015 fell by 2.2% to RM35.5bil from RM36.3bil reported in FY2014. This was mainly due to lower generation costs resulted from lower consumption of LNG, as well as oil & distillate as compared to previous year.
Lower commodity prices, namely coal and LNG)also contributed to the lower generation costs. The average coal price was recorded at RM236 a tonne as compared to RM244.6 last year, whilst the average LNG price was RM45.21 mmbtu versus RM46.45 last year.
TNB president and CEO Datuk Seri Azman Mohd stated the FY15 performance illustrated the effectiveness of Incentive Based Regulation (IBR) framework in providing earnings stability and visibility to TNB.
“The IBR framework provides a fair level of return for TNB to operate efficiently; whilst the ICPT implementation ensures TNB’s neutral exposure to fluctuations in generation costs.
“The IBR implementation also benefited the consumers directly, whereby savings from the lower generation costs resulted from reduction in commodity prices have been passed back to consumers in the form of tariff rebates from March 2015 until current,” he said.
He also said TNB continued to be impacted by the slowdown in the global economy and the depreciating Ringgit during the year under review. Electricity demand growth of 2.2% was recorded for the year as compared to 2.5% growth recorded in FY2014.
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