Sustained Financial Performance Resulting From Lower Coal Prices and Strengthening of Ringgit

22/01/2013

Kuala Lumpur, 23 January 2013 - Tenaga Nasional Berhad (TNB) today announced a Net Profit Attributable to Shareholders of RM1,415.5 million, for the 1st Quarter of the Financial Year ending 31 August 2013 (FY2013).

The positive results in TNB’s Group Performance for the first three month period in FY2013 is principally attributed to lower generation costs and foreign exchange translation gain. The foreign translation gain was resulted from strengthening of Ringgit against Yen and USD by 7.4% and 2.7% respectively. However, after adjusting for foreign exchange translation gain, the Net Profit before Forex Translation is reported at RM1,018.1 million.

Summary of highlights:

 
• Net Profit Attributable to Shareholders of RM1,415.5 million
 
• 9.6% decrease in Operating Expenses
 
• Average coal price of USD110.0/mt (1QFY2012 : USD84.4/mt)
 
• 3.5% unit electricity demand growth in Peninsular Malaysia
 
• EBITDA margin of 31.0% (1QFY2012 : 18.0%)
 
• Strengthening of RM against Yen and USD by 7.4% and 2.7% respectively

Comparing the Group’s performance for 1st Quarter 2013 against the corresponding period in FY2012, the operating costs registered a reduction of 9.6% from RM8,259.8 million to RM7,465.9 million. This was mainly attributed to the recognition of fuel cost compensation in 1st Quarter FY2013 and the lower generation costs in line with declining global coal market price. During the current quarter, the average coal price was recorded at USD84.4 per metric tonne as compared USD110.0 per metric tonne recorded in the corresponding period in FY2012, reflecting a reduction of 23.3%. This coupled with the strengthening of the Ringgit against the USD during the quarter further enhance the savings in generation costs for 1Q FY2013.

In FY2012, the Fuel Cost Compensation mechanism was only recognised and restated into respective periods during the third quarter. Therefore, for fair comparison, we have restated Fuel Costs Compensation for 1st Quarter 2012 to better reflect the performance of the company as illustrated in the following table. The operating costs registered a decrease of 3.4% from RM7,730.2 million to RM7,465.9 million. Correspondingly, this contributed to the improvement in the EBITDA margin from 24.0% to 31.0%.

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