TNB's earnings slip to RM328mil in Q2, revenue grow to RM13.32bil from RM12.84bil

KUALA LUMPUR: Tenaga Nasional Bhd's (TNB) saw its net profit slide 62.4 per cent to RM327.9 million in the second quarter ended June 30, 2023 (2Q23) from RM872.2 million a year ago, dragged by negative fuel margins and foreign exchange translation losses. 

Group revenue, however, rose to RM13.32 billion from RM12.84 billion in 2Q22, driven by higher sales of electricity by 3.5 per cent or RM434.2 million. 

TNB's operating profit for the current period decreased by 21 per cent or RM1.05 million due to the lower ICPT under recovery recognised in the current period by 33.8 per cent or RM3.32 million.  

Earnings per share fell to 5.70 sen compared to 15.23 sen previously. 

For the cumulative period of six months, TNB's net profit declined to RM1.33 billion from RM1.77 billion a year ago, while revenue rose to RM25.95 billion from RM25 billion. 

On prospects, TNB said the group reported a fair performance despite the challenging environment for the period ended June 30.  

It added that the electricity demand growth recorded at two per cent was in line with Malaysia's gross domestic product (GDP) expansion of 2.9 per cent in 2Q23.

However, its earnings were impacted by the negative fuel margin and foreign exchange volatility. 

"Declining coal prices globally has alleviated the pressure on the group's cash flow position.  

"This, coupled with stronger collection rate, have contributed to a favourable accounts receivable movement and a stronger working capital position," the group said. 

With the overall economy projected to grow at the lower end of the four to five per cent range, TNB expects a reasonable performance for the year 2023 and will continue to remain cautious on its earnings exposure to fuel prices and currency volatility.  

The group will continue to take prudent measures in managing its operational and financial requirements to ensure it remains resilient.