Thursday, July 21, 2011

Tenaga zapped by operating expenses, posts net loss RM440.2m in 3Q

KUALA LUMPUR: TENAGA NASIONAL BHD [], which posted net loss RM440.20 million for the third quarter ended May 31, 2011 compared to net profit RM1.11 billion a year earlier, said it expects its full year results to be severely impacted due to significant increase in operating expenses.

Tenaga said on Thursday, July 21 that revenue for the quarter rose marginally to RM7.77 billion from RM7.72 billion in 2010. Loss per share was 8.08 sen from earnings per share 20.39 sen a year earlier, net assets per share was RM5.32.

For the nine months ended May 31, Tenaga's net profit fell to RM903 million from RM2.81 billion in 2010 despite an increase in revenue to RM22.99 billion from RM22.45 billion.

Reviewing its performance, Tenaga said operating expenses rose by 14.6% and eroded the operating profit by 62% to RM2.15 billion from RM3.47 billion.

It said significant increase in operating expenses was mainly due to higher generation costs from the utilisation of coal, oil and distillate, resulting from sever gas curtailment during 3Q.

It said the average price of coal was US$103 per tonne compared to US$85.10 per tonne a year earlier.

'Effectively, lower earnings before interest, tax, depreciation and amortisation margin was recorded, from 28.2% to 18.7%,' it said.

On its prospects, Tenaga said that for the rest of the year, with coal prices trading above US$100 per cubic tonne, compounded by higher cost of generation using oil and distillate due to continuing lower gas supply, the results for the current financial year was expected to be severely affected.

'However, Tenaga will continue to strive in ensuring reliability and security of supply in meeting the demand.

'The board of directors expects the group's prospects for the year ending Aug 31, 2011 to be very challenging and that the financial results for the full year to be lower compared to the previous year,' it said.

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