Higher earnings for TNB

Utility giant net profit jumps 85.5% in the fourth quarter

“TNB is rewarding its shareholders with a special dividend of 40.0 sen per share in addition to a final dividend of 18.0 sen per share.” TNB

KUALA LUMPUR: Tenaga Nasional Bhd’s (TNB) net profit jumped 85.5% to Rm1.21bil in the fourth quarter ended Dec 31, against Rm653.3mil a year ago.

In the notes accompanying its financial results, the utility giant said yesterday the higher earnings was mainly due to higher tax credit resulting from the claim of the reinvestment allowance incentive.

Revenue for the quarter fell 15.2% to Rm10.32bil from Rm12.17mil.

Its operating expenses reduced 21.2% to Rm8.89bil from Rm11.29bil mainly due to lower generation cost.

This has resulted in a higher operating profit of Rm1.45bil, an increase of Rm105.2mil or 7.8%.

TNB is rewarding its shareholders with a special dividend of 40.0 sen per share in addition to a final dividend of 18.0 sen per share, in respect of the financial year (FY) 20, totalling to Rm3.3bil.

The books closure and payment dates will be announced in due course.

For the full financial year ended Dec 31, 2020 (FY20) TNB posted a net profit of Rm3.59bil, 20.6% lower than Rm4.52bil posted in FY19.

This is mainly due to a lower revenue recorded, lower finance income resulting from lower interest rates and higher finance cost attributed to the expensing of finance cost to the profit and loss for newly commissioned plant, Tuanku Muhriz Power Station.

“This was offset by the tax credit on the reinvestment allowance incentive claimed by TNB based on the Finance Act 2020 gazetted by the government on Dec 31,” TNB said.

Under the Incentive Based Regulation (IBR) framework, the regulated business reported a return of Rm4.21bil, TNB said.

Revenue in FY20 decreased by 13.7% to Rm43.97bil from Rm50.93bil mainly due to lower sales of electricity of Rm6.7bil, down 13.4%, from Rm49.91bil in FY19.

Commenting on its prospects, TNB said: “The board of directors foresees the pace of recovery that the group has registered in the second half of the financial year for 2020 will continue into 2021, although with some challenges following the re-imposition of the Movement Control Order (MCO).”

“However, the impact will be cushioned as most economic activities remain operational. The group has taken prudent measures in terms of its operational and financial requirements to ensure it remains resilient,” TNB said.