Tenaga Posts Second Straight Quarterly Profit After Compensation
Tenaga Nasional Bhd. (TNB), Malaysia’s biggest power producer, reported a second straight quarterly profit after booking another 777.8 million ringgit ($247 million) in state compensation for disruptions in gas supply.
The utility posted net income of 619.1 million ringgit, or 11.3 sen per share, for its fiscal third quarter ended May 31, compared with a restated net loss of 179.2 million ringgit or 3.3 sen per share a year earlier, Tenaga said in a statement yesterday. Revenue climbed 15 percent to 9.2 billion ringgit from a restated 7.98 billion ringgit a year ago, it said.
“The group is expected to record a better performance than the last financial year mainly due to expected higher demand, implementation of a fuel cost-sharing mechanism and higher coal plant availability,” Tenaga said in the statement.
The Kuala Lumpur-based utility is getting compensation from the government and state-owned energy group Petroliam Nasional Bhd. after disruptions in gas supply forced it to buy costlier alternative fuels to power its plants. This latest payout, yet to be received, is for additional costs incurred in the seven months to May.
This compensation agreement is scheduled to end in September when Petroliam Nasional, or Petronas, is expected to boost supply with the opening of a regasification plant in Malacca state, Azman Mohd, Tenaga’s new chief executive officer, told reporters in Kuala Lumpur.
“We will remain neutral and shielded from any changes in gas prices” due to state subsidies, said Azman, who was promoted earlier this month when Che Khalib Mohamad Noh decided not to renew his contract.
Operating expenses fell 12 percent in the third quarter from a year earlier to 7.3 billion ringgit, as coal costs eased, said Azman, previously chief operating officer.
Tenaga paid an average $104.30 per metric ton for its coal during the three-month period ended May, down from $108.50 in the preceding quarter. The price may fall to $100 in the current quarter, Azman said.
Tenaga’s shares rose 0.3 percent to close at 6.75 ringgit in Kuala Lumpur before yesterday’s earnings announcement. They have risen 14 percent this year, outpacing a 7 gain in the benchmark FTSE Bursa Malaysia KLCI Index.
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