KUALA LUMPUR: Tenaga Nasional Bhd (TNB) posted a 42 per cent higher net profit at RM3.72 billion as revenue breached RM50 billion for the year ended December 31 2018, thanks to higher sales of electricity
The group’s revenue surged to RM50.39 billion from RM15.69 billion previously, on the back of higher sales of electricity.
In 2017, TNB changed its financial year end from August 31, 2018 to December 31, 2017. Thus, it is comparing the 2018 results with a “shorter” financial year covering just four months from September to December 2017.
In a statement today, TNB said its earnings before interest, tax, depreciation and amortisation (EBITDA), however, was recorded lower at RM13.37 billion.
This was due to the lower allowable return of 7.3 per cent under Incentive Based Regulation (IBR) RP2 (2018 – 2020) compared to 7.5 per cent in RP1 (2014-2017).
Under RP2, the regulator introduced a revenue cap for the distribution network business and TNB returned RM639 million back to the consumers for 2018.
It said a one-off cost of impairments to the group’s investments, in addition to substantial foreign exchange translation losses of RM390 million due to the weakening of ringgit, contributed to higher operating expenses.
TNB president and chief executive officer Datuk Seri Ir. Azman Mohd said the stable returns ensured by IBR had enabled it to reinvest heavily into ensuring the reliability and sustainability of the national grid while enabling increasing investments in renewable energy.
“We intend to forge ahead with our strategic plan that is aligned towards creating value for customers while supporting the government’s push towards MESI 2.0.
“This plan will enhance TNB’s business strategy of Reimagining TNB, started in 2015, towards sustainable development across the value chain, from generation to transmission and distribution as well as customer service,” he said.
TNB said a total of RM11.82 billion capital expenditure was incurred in 2018 to maintain, improve and modernised the power infrastructure.
TNB approved a 56 per cent dividend payout ratio from its adjusted net profit of RM5.42 billion. This translates to a total of 53.27 sen per share for financial year 2018, of which 23 sen per share will be distributed as the final single tier dividend.