Tenaga Nasional Bhd · MYX:TENAGA
Tenaga Nasional Bhd — FY2022 Earnings Presentation
41 slides from Tenaga Nasional Bhd's earnings presentation, Feb 28, 2023
Slide 1: 4Q FY2022 Analysts Briefing
4Q FY2022 Analysts Briefing 28 February 2023
Slide 2: Key Highlights: Delivering strong performance with sustainable dividend
Key Highlights: Delivering strong performance with sustainable dividend to shareholders; effective capital management amidst challenging times a) Strong financial performance 1 FY2022 b) Solid technical operations contributed by generation performance and Performance world-class network standard Div
Slide 3: Strong FY2022 financial performance (EBITDA)
1a Strong FY2022 financial performance (EBITDA) supported by higher Peninsular electricity demand at 6.0% year-on-year REVENUE EBITDA PAT +5.7% EBITDA margin 40.9% 39.0% 50,867.7 48,119.9 Revenue (RM mil) EBITDA (RM mil) +10.9% PAT (RM mil) (8.0%) 20,812.0 18,774.5 3,557.4 3,864.7 FY2022 FY2021 FY20
Slide 4: Group earnings supported by improved generation and network performance
Group earnings supported by; (i) Improved generation business 1b (ii) World-class network performance Year Achievement Target 2021 83.0% 86.1% 2022 83.2% 82.8% EAF performance secured generation Equivalent Plant Availability Factor, EAF assets’ capacity revenue (Generation) % 2023 Target: 81.8% Inte
Slide 5: We strive for sustainable dividends to ensure long term value
We strive for sustainable dividends to ensure long term value for the shareholders, 2 proven by our historical dividend payout record 56.0% 56.0% 58.5% 52.8% 55.2% 7.5% 7.7% 4.3% 4.8% DIVIDEND POLICY 3.9% We will continue to honour our dividend policy of 30% to 60% dividend payout 50.0 ratio, based
Slide 6: Effective working capital management alleviates pressures from high fuel prices
3 Effective working capital management alleviates pressures from high fuel prices Receivables (RM bil) Receivables 1 ICPT Cost Recovery ai TNB will fully recover the net imbalance cost via: 16.9 (1HFY23) • The ICPT surcharge passed-through to non-domestic 15.5 customers (at 3.70sen/kWh and 20.0 sen/
Slide 7: Forward Guidance
Forward Guidance 2023 promises to be another exciting year as we pursue our Net Zero 2050 aspirations Delivering Value to our Shareholders Electricity Latest demand growth is 1.7% (120,933 GWh)* Demand (IBR reference: 116,367 GWh) We will continue to honour our dividend policy of 30% - 60% dividend
Slide 8: Key Highlights: Commitment to sustainability has intensified in 2022
Key Highlights: Our commitment to sustainability has intensified in 2022, resulting in exciting developments across our businesses 4 Sustainable Growth Committed in delivering value to shareholders while aspiring to be a leading provider of sustainable energy solutions through progress in our strate
Slide 9: Future Generation Sources: ~8,000MW pipeline
COD To date, GenCo and NED have a strong ~8,000MW pipeline ready to 4a Future Generation Sources be explored for opportunities… 2022 Key Achievements Pipeline Projects 2023 Outlook Nenggiri Hydro 300MW Paka Repowering 1,400MW • Nenggiri Hydro: Expected to COD in Q2 2027 COD: Q2 2027 COD: 2030 Projec
Slide 10: Joint studies on green technologies
4a Future Generation Sources Joint studies on green technologies are imperative to ensure the success of our strategic plans Green Technology Joint Study Current Updates & Outlook • TPGSB is currently working under Joint Working Committee with PETRONAS on Green Hydrogen under the corporate MOU signe
Slide 11: Grid of the Future: regional interconnection
We play a key role in regional interconnection…one of our 4b Grid of the Future trailblazing initiatives towards a successful transition for all RP3 13% (RM2.54 bil) Key Projects Towards becoming a Approved Supporting the Energy Transition Smart Utility by 2025 Capex (ET) and RAB growth Progress as
Slide 12: Winning the Customer: electric vehicle ecosystem
4c Winning the Establish partnership with prominent industry leaders to develop Customer extensive electric vehicle ecosystem for the nation Electric Vehicle Infrastructure Development Electric Vehicle Training Hub Electron Charger Hub ILSAS Electric Vehicle (EV) Training Hub Launched 2 hubs for pil
Slide 13: GSPARX rooftop solar growth
GSPARX will provide the ‘extra’ push on renewable energy penetration 4c Winning the Customer while growing TNB’s revenue source GSPARX GSPARX aims to secure ~145MWp for 2023 Targeted Market Segments 2022 Key Achievements Residential • Klang Valley customers Partnership with Smart Modular Technology
Slide 14: Appendix
Appendix 4Q FY2022 o Details on Financial Results o Generation Business Performance o International Business Performance o Shareholdings Analysis
Slide 15: Year-on-Year (Y-o-Y) analysis
Year-on-Year (Y-o-Y) analysis Variance Y-o-Y analysis: RM mil FY2022 FY2021 RM mil % Revenue 1 50,867.7 48,119.9 2,747.8 5.7 Higher revenue mainly due to 1 Imbalance Cost Pass Through (ICPT) 22,315.3 4,509.6 17,805.7 >100.0 Group’s sales of electricity Operating expenses (without depreciation) 2 (53
Slide 16: Quarter vs Previous Quarter analysis
Quarter vs Previous Quarter (4QFY22 vs 3QFY22) analysis Variance RM mil 4QFY22 3QFY22 Quarter vs Previous Quarter analysis: RM mil % Revenue 1 12,915.1 12,961.8 (46.7) (0.4) 1 Lower revenue mainly due to Imbalance Cost Pass Through (ICPT) 6,397.7 6,109.6 288.1 4.7 lower TNB sales of electricity Oper
Slide 17: Y-o-Y normalised EBITDA & PAT for FY2022
Y-o-Y normalised EBITDA & PAT for FY2022 EBITDA FY2022 FY2021 Components RM mil RM mil 1 Please refer MFRS16 impact slide for details. Reported EBITDA 20,812.0 18,774.5 Impairment - 276.4 2 Additional ADD for TNB* 69.8 514.2 Stronger normalised EBITDA in FY2022 (refer Appendix Slide 2 MFRS16 impact
Slide 18: Higher Y-o-Y sales of electricity and contribution from subsidiaries
Higher Y-o-Y sales of electricity and contribution from subsidiaries, driven by stronger economic growth Variance Variance 4QFY22 3QFY22 FY2022 FY2021 (4QFY22 vs 3QFY22) (FY2022 vs FY2021) UNITS SOLD GWh GWh GWh % GWh GWh GWh % Sales of Electricity (GWh) 1 - TNB 29,415.1 30,347.5 1 (932.4) (3.1) 118
Slide 19: Other regulatory adjustment of RM778.2 mil to be returned
As at FY2022, other regulatory adjustment of RM778.2 mil to be returned 1QFY22 2QFY22 3QFY22 4QFY22 FY2022 FY2021 Components of Other Regulatory Adjustment (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) 1 Revenue Adjustment for Revenue Cap & Price Cap (44.2) (239.4) (211.8) (21.7) (517.1) (32
Slide 20: Electricity demand grew in tandem with GDP
Y-o-Y electricity demand grew in tandem with GDP % GDP & TNB Demand Growth TNB (Peninsular) Yearly Peak Demand 8.7 * Full Year 5.9 MW 5.0 4.2 4.7 4.3 19,183 3.1 6.0 18,808 18,566 3.2 18,338 2.2 2.5 2.5 2.7 1.2 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 17,788 17,790 18,585 -4.9 Recorded on: -5.6 16,901
Slide 21: Improved electricity demand in industrial & commercial sectors
Improved Y-o-Y electricity demand mainly in industrial & commercial sectors Industrial Commercial FY2022 main contributors for the increase in: 3.3% 15.9% Industrial sectors • Iron & steel, electric & electronic and (0.2%) 5.8% 12.5% (3.8%) transportation products 10.2% 17.6% 30.9% 7.0% Commercial s
Slide 22: Higher Y-o-Y operating expenses due to generation cost
Higher Y-o-Y operating expenses due to increase in generation cost Variance Variance 4QFY22 3QFY22 FY2022 FY2021 (4QFY22 vs 3QFY22) (FY2022 vs FY2021) (RM mil) (RM mil) RM mil % (RM mil) (RM mil) RM mil % Non-TNB IPPs Costs 5,097.7 5,337.5 (239.8) (4.5) 17,999.5 8,863.8 9,135.7 >100.0 1 Reported as
Slide 23: Higher Y-o-Y fuel costs due to coal and gas prices
Higher Y-o-Y fuel costs mainly due to higher coal and gas prices Table A – TNB & IPP Fuel Costs for Peninsular (RM mil) Table C – Fuel Costs Related Data Fuel statistics FY2022 FY2021 Variance Average Coal Price Delivered (USD/MT)(CIF) 212.5 116.2 Fuel Type FY2022 FY2021 Average Coal Price Delivered
Slide 24: Higher 4Q vs 3Q fuel costs due to coal price
Higher 4Q vs 3Q fuel costs mainly due to higher coal price Table A – TNB & IPP Fuel Costs for Peninsular (RM mil) Table C – Fuel Costs Related Data Variance 4Q vs 3Q Fuel statistics 4QFY22 3QFY22 2QFY22 1QFY22 Fuel Type 4QFY22 3QFY22 2QFY22 1QFY22 Average Coal Price Delivered (USD/MT)(CIF) 222.4 229
Slide 25: Lower generation from coal in FY2022
Lower generation from coal in FY2022 Generation Mix for Industry (%) 0.9 0.9 0.9 0.8 0.9 0.9 1.2 1.4 1.5 1.2 6.6 5.0 5.1 5.2 5.5 4.8 3.5 6.3 6.2 5.2 0.1 0.0 0.1 0.3 0.1 1.1 0.4 0.6 0.5 0.0 56.5 57.7 54.1 57.8 55.9 60.9 59.2 56.5 55.1 61.9 37.6 36.0 39.1 37.1 35.8 36.7 37.2 30.5 33.0 34.3 1QFY21 2QFY
Slide 26: Fuel Costs & Units Generated (TNB & IPPs – Peninsular)
Fuel Costs & Units Generated (TNB & IPPs – Peninsular) Fuel Costs Units Generated Distillate TNB, 0% Distillate TNB, 0% Distillate IPP, 0% Distillate IPP, 1% Oil TNB, 0% LNG, 0% Oil IPP, 0% Oil TNB, 0% Solar TNB, 0% Oil IPP, 0% Hydro, 5% Solar IPP, 1% Gas IPP, 12% Distillate TNB, 1% Distillate IPP,
Slide 27: TNB is neutral to fuel cost volatility under ICPT
TNB is neutral to volatility in fuel costs under the ICPT framework 1QFY22 2QFY22 3QFY22 4QFY22 FY2022 (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) Reported Total Cost of Generation 8,367.1 11,634.6 11,029.5 12,052.8 43,084.0 (with MFRS16) Adjustment not related to IBR 909.5 948.3 840.2 307.2* 3,005
Slide 28: Coal price trending
Coal price trending 1023.80 1040.10 960.40 1028.10 1022.32 723.70 696.30 626.40 557.21 530.47 517.93 458.12 422.60 428.44 395.92 361.40 379.84 361.22 347.03 363.40 411.10 321.56 375.30 291.87 294.87 281.12 361.70 340.50 352.05 359.91 248.60 249.03 324.99 301.88 268.24 289.33 265.81 229.76 238.77 250
Slide 29: Industry coal requirement forecast for FY2023
Industry coal requirement forecast for FY2023 Coal Consumption (mil MT) Source Country Mix 3.0% 34.7 10.0% 30.8 32.3 31.9 31.5 27.4 28.8 25.4 22.2 17.0% 19.3 70.0% * FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 (F) Indonesia Australia * Based on tonnage planned for delivery in FY2023 Russia Sou
Slide 30: MFRS 16: Group PAT negatively impacted
MFRS 16: Group PAT is negatively impacted by RM920.3 mil in FY2022 Net Impact of MFRS 16 (Y-o-Y) analysis FY2022 FY2021 Variance (RM mil) (RM mil) (RM mil) Capacity Payment 4,440.1 4,137.6 302.5 Depreciation (3,875.9) (3,473.4) (402.5) Finance Cost (1,756.4) (1,460.1) (296.3) Deferred Tax 271.9 175.
Slide 31: Group CAPEX, Regulated CAPEX and RAB
Group CAPEX Regulated CAPEX and Regulated Asset Base (RAB) RM mil 8,853.2 8,459.4 224.9 934.3 RP3 REGULATED ENTITIES CAPEX 2,216.2 FY IBR Approved Actual YTD Utilisation 2,051.4 (RM mil) (RM mil) (%) 2022 7,168.0 6,723.3 93.8% 4,592.9 4,688.4 Total RAB (RM mil) Actual Approved FY2022 FY2022 61,339.4
Slide 32: Gearing stood at 51.2% in FY2022
Gearing stood at 51.2% in FY2022 Loan Breakdown Statistics 31 Dec 2022 31 Dec 2021 RM3.2 bil RM Total Debt (RM bil) 63.9 51.7 RM1.8 bil USD Net Debt (RM bil)* 50.8 42.5 3% 5% JPY RM8.5 bil 13% 4% 5% Gearing (%) 51.2 47.0 GBP 15% RM2.4 bil Net Gearing (%) 40.7 38.6 RM8.0 bil RM2.1 bil 79% RM50.4 bil
Slide 33: Improvement in trade debtors balance
Improvement in trade debtors balance by 2.9% in Dec’22 Trade Debtors Ageing (RM bil) Trade Receivables By Sectors (RM bil) Total 4.92 5.17 5.31 5.26 5.10 4.92 5.17 5.31 5.26 5.10 1% 1% 2% 2% 1% 0.01 0.02 0.02 0.00 Undue 0.01 37% 36% 35% 34% 34% Others 1.04 1.17 1.28 1.23 1.13 Current 0.30 0.39 0.31
Slide 34: Domestic generation business performance
Domestic generation business performance RM mil REVENUE EBIT PROFIT AFTER TAX 27,771.7 EBIT 19,496.2 Margin 9.4% 12.0% 2,601.4 2,344.6 860.5 661.3 FY2022 FY2021 FY2022 FY2021 FY2022 FY2021 Higher revenue mainly due to higher energy payment resulted from higher fuel prices EBIT uplift initiatives of
Slide 35: Our RE journey is progressing well
Our RE journey is progressing well TNB RE Journey Renewable capacity (MW) % RE in TNB’s portfolio 17% 17% 15% International 3,907 3,889 3,487 Domestic 993 993 716 Note: 2,914 2,896 2,771 • RE capacity includes large hydro • Gross RE Capacity RE Jan RE Dec RE Dec 2023 2022 2021 Recent RE Progress 1)
Slide 36: International Performance: core/renewable assets
INTERNATIONAL BUSINESS - CORE/RENEWABLE ENERGY (RE) ASSETS International Performance as at Dec’22 Vantage RE EM: 74% EBITDA (mil) 90.30 72.87 61.58 44.78 GBP USD FY2021 FY2022 • Higher EBITDA Y-o-Y due to better operational performance and higher generation from Vantage Solar and TWV as a result of
Slide 37: International Performance: non-core assets
INTERNATIONAL BUSINESS - NON-CORE ASSETS International Performance as at Dec’22 Shuaibah GAMA Enerji A.S. (GEAS) GMR Energy Limited (GEL) E B I T DA ( m i l ) E B I T DA ( m i l ) 1 EM: 21% E B I T DA ( m i l ) 1 EM: 80% EM: 38% 999.89 2,554.05 17,820.81 786.10 2,000.00 157.33 266.64 209.63 1,039.85
Slide 38: Revenue from coal remains below 25%
Revenue from coal remains below 25%, in line with longer-term aspiration Actual Group Revenue* FY2022 (%) 24 * RE Coal Others ** 3 * Total revenue includes ICPT 73 ** Others include revenue from regulated business, subsidiaries and generation from gas Long-term aspiration: ▪ No new coal plant invest
Slide 39: TNB market capitalisation of RM55.4 bil
TNB market capitalisation of RM55.4 bil as at 31 December 2022 Top 10 KLCI Stocks by Market Capitalisation as at 31 December 2022 Khazanah Nasional Berhad 15.8 RM bil 18.3 Permodalan Nasional Berhad 104.9 Maybank +6.4% (PNB) 98.6 18.4 16.2 Employees Provident Fund 7.3 83.9 Board (EPF) Public Bank +3
Slide 40: Disclaimer
Disclaimer This presentation and discussion may contain forward looking statements by Tenaga Nasional Berhad related to financial trends for future periods. Some of the statements contained in this presentation or arising from this discussion which are not of historical facts are statements of futur
Slide 41: Thank You
THANK YOU IR OFFICERS: 1) Sarah Keok • +603 2108 2126 INVESTOR RELATIONS • sarahk@tnb.com.my GROUP FINANCE DIVISION 2) Sakinah Mohd Ali Tenaga Nasional Berhad • +603 2108 2840 Level 12, Tower A, TNB Platinum • sakinah.ali@tnb.com.my No. 3, Jalan Bukit Pantai, 3) Intan Nur Najihah Basiron Bangsar 591
Tenaga Nasional Berhad — FY2022 Earnings Presentation on 6ix