Tenaga Nasional Berhad said it is likely to see a decline in its Imbalance Cost Pass-Through (ICPT) receivables, attributing this positive trend to moderating coal prices. The trend it said will significantly enhance its working capital, consequently boosting its cash flow, and improving gearing levels in 2023, according to TNB President and Chief Executive Officer, Dato’ Indera Ir. Baharin Din.
The result is due to the global reduction in coal prices, combined with the utility giant’s proactive approach to enhancing revenue collection, allowing it for an improved cash flow outlook. This was further supported by the RM6 billion government-guaranteed loan to stabilise the energy industry. These factors collectively contributed to TNB’s strengthened cash flow position and gearing level in the first half of 2023 (1H2023).
“TNB’s prudent capital management enables the company to reward the shareholders with an interim dividend of 18 sen, which accounts for 49.4% of the Adjusted Profit After Tax After Minority Interest (PATAMI),” Baharin said during a recent analyst briefing on the Group’s second-quarter financial results.
Improvement in ICPT receivables is underscored by the successful recovery of RM10.4 billion in ICPT costs for the period of January to June 202, moreover, the company is expected to recover RM4.7 billion of ICPT costs from the Government in the second half of the year.
On the ICPT Outlook, for the first half of the 2024 financial year, TNB estimates a recovery of approximately RM 7.0 billion from ICPT, based on current fuel price trends. This forward-looking perspective reflects TNB’s proactive stance in managing its financial outlook and controlling fuel-related expenditures.
Baharin also commented on TNB’s performance during the first half of the year ending 30 June 2023. Despite challenges stemming from negative fuel margins and foreign exchange volatility, TNB reported a commendable performance in this demanding environment. During this period, TNB reported a profit after tax of RM1.20 billion, while revenue saw a 3.8 percent increase to RM25.95 billion, compared to the corresponding period in 2022.
