Friday, October 17, 2008

How RM 283M was lost?


Tenaga Nasional Bhd (TNB) has posted its first quarterly net loss in four years as its earnings were eroded by higher coal prices, independent power producers’ (IPPs) cost and a weaker ringgit.
It posted a net loss of RM282.9mil in the fourth quarter ended Aug 31 compared with a net profit of RM168.4mil in the previous corresponding period.
Announcing the results yesterday, the national power utility said in a statement its revenue in the quarter rose to RM7.09bil compared with RM6.12bil previously. Loss per share was 6.53 sen compared with earnings per share of 3.89 sen. It proposed a dividend of 10 sen per share compared with 16.3 sen a year ago.
TNB said its operating profit shrank to only RM259.4mil, sharply lower than RM1.2bil a year ago, weighed down by sharply higher operating expenses of RM6.98bil (from RM5.11bil a year ago). Read more here.
How come I am not surprise at all? First, they privatised TNB and then they planted their own leeches onto TNB to draw the blood. These leeches come in the form of IPPs whereby they were given good concession rates plus those subsidized fuel rate from Petronas. Guarantee profit for a period of time. No wonder they have been raking in handsome profit year after year since their existence. Check who owns these IPPs? Cronies of the previous regime. No wonder so powerful. Present government can't even impose a 5% windfall tax on them. Warlords objection, I presume.

National power company Tenaga Nasional Bhd (TNB) does not want the Government to make the same mistake twice by extending the concession period for power plants operated by independent power producers (IPPs).

“Do not go and sign another extension when we may not have gas (subsidies), people will laugh at us,” said TNB president and CEO Datuk Che Khalib Mohamad Noh. “Don’t make the same mistake twice.’’ Read more here.

This statement by the TNB's CEO more or less confirmed the whole situation. This is not an isolated case. Happening in Telekom too through VADS.
Blame it on the hike in raw material costs. Main culprit is the lopsided concession given to the IPPs.

3 comments:

ctchoo said...

I agree fully with your analysis. I am still peeved at paying RM100 more for my electricity bill. The tariffs were raised on the basis that the fuel prices were rising very high. Now that oil is down to about USD70+ per barrel, will these buggers review the tariffs to help poor sods like me out?

Anonymous said...

just to do some correctness here.. the fuel subsidized by Petronas is for IPP but it is for the people which translated into lower tariff.. for your information, electricity rate in Malaysia isn't a market price.. that's why we paying far less than market price..

TheWhisperer said...

Anon,

Correction. Why should IPP benefit from fuel subsidies? Why don't give it straight to TNB?

Don't tell me it is translated into lower tariff here. It is supposed to be but to subsidize IPPs, something is wrong somewhere. Don't forget that enjoy a good concession rate.

It was all abuse right from the beginning.