Tenaga Nasional Bhd · MYX:TENAGA
Tenaga Nasional Bhd — Investor Presentation (November 2020)
41 slides from Tenaga Nasional Bhd's investor presentation, November 2020
Slide 1: Investor Presentation
INVESTOR PRESENTATION COE – INVESTOR RELATIONS
Slide 2: Agenda
01 INTRODUCTION TO TENAGA 02 REGULATORY AGENDA 03 BUSINESS STRATEGY & DIRECTION 04 DIVIDEND POLICY 05 FY2020 OUTLOOK 06 APPENDIX
Slide 3: Regulatory & Shareholding Structure
INTRODUCTION TO TENAGA Regulatory & Shareholding Structure REGULATORY & SHAREHOLDING STRUCTURE PRIME MINISTER / CABINET Sabah Electricity Sdn Bhd (SESB) (83% owned by TNB) Dependable Capacity: Shareholders Policy Maker 1,223MW Tenaga Nasional Bhd (TNB) Holds Ministry of Energy and Ministry of Financ
Slide 4: Regulated & Non-Regulated Business
INTRODUCTION TO TENAGA Regulated & Non-Regulated Business Generation Grid/Transmission Distribution Network & Retail Non-Regulated Business Regulated Business TNB Generation Mix: Installed Capacity: Distribution Network Length: Core Business 25,414MW Transmission Network Length: 683,008KM Oil & Dist
Slide 5: TNB Sectoral Sales Analysis
INTRODUCTION TO TENAGA TNB Sectoral Sales Analysis* Total Unit Sold 53,535.7 GWH 0.9% 1.7% 2.1% Total 25.0% 28.8% Assets RM174.3bn 81.8% Total 37.9% 32.1% TNB: 9.3mn Customers SESB: 0.6 mn Total 35.3% 37.0% Employees 35,878 17.1% 0.3% NO O F C USTO ME R SA LES (RM) SA LES (G W H) Industrial Commerci
Slide 6: Electricity Demand in line with GDP Growth
INTRODUCTION TO TENAGA Electricity Demand in line with GDP Growth GDP & TNB (Peninsula) Demand Growth TNB (Peninsula) Yearly Peak Demand MW * 18,808 18,566 18,338 17,788 17,790 *Recorded at: 10 Mar’20 16,901 16,822 at 1630hrs 16,562 15,826 15,476 FY'11 FY'12 FY'13 FY'14 FY'15 FY'16 FY'17 FY'18 FY'19
Slide 7: Growing Renewable Energy Business
INTRODUCTION TO TENAGA Growing Renewable Energy Business– TNB is currently present in more than 5 countries • 55% equity ownership in Vortex Solar Investments S.à.r.l, United 24 operational solar PV farm portfolio of 365MW (May 2017) United Kingdom • Tenaga Wind Ventures UK Ltd, 53 operational onsho
Slide 8: TNB Shareholding Structure and Top KLCI Stocks
INTRODUCTION TO TENAGA TNB Shareholding Structure Top 10 KLCI Stocks by Market Capitalization RM bil Khazanah Nasional Berhad 84.4 (13.1%) Maybank 18.4 97.1 17.0 66.3 Permodalan Nasional Berhad TNB (12.1%) (PNB) 75.4 17.5 15.5 64.1 Employees Provident Fund Public Bank (15.1%) Board (EPF) 75.5 5.6 6.
Slide 9: Agenda
01 INTRODUCTION TO TENAGA 02 REGULATORY AGENDA 03 BUSINESS STRATEGY & DIRECTION 04 DIVIDEND POLICY 05 FY2020 OUTLOOK 06 APPENDIX
Slide 10: Incentive Based Regulation (IBR)
INCENTIVE BASED REGULATION (IBR) A Mechanisms For Tariff Setting With Incentives To Improve Efficiency & Greater Transparency Non – Regulated Regulatory Environment: (competitive bidding environment) 1. Clear and Transparent Regulatory Framework Clear and transparent regulatory framework governed by
Slide 11: IBR Regulatory Period
INCENTIVE BASED REGULATION (IBR) Regulatory Period 2 Average Tariff by Entities (sen/kwh) Fuel Parameters Base tariff for RP2 COAL USD75/MT (RM14.47/mmbtu @ RM4.212/USD) (sen/kWh) RP1 : USD87.5.MT @ RM3.100/USD LNG RM35/mmbtu RP1 : RM41.68/mmbtu REGULATED RM24.20/mmbtu (Jan’18 - Jun’18) Single Buyer
Slide 12: IBR Regulatory Period Timeline
INCENTIVE BASED REGULATION (IBR) Interim Year 2021 Regulatory Period Timeline INTERIM YEAR RP2 (2018 – 2020) 2021 RP3 (2022 – 2024) 2018 2019 2020 2021 2022 2023 2024 ➢ Energy Commission (EC) has agreed for RP3 to be in 2022-2024, and RP2 to be extended (FY2021 – Interim year). ➢ TNB is in discussio
Slide 13: Agenda
01 INTRODUCTION TO TENAGA 02 REGULATORY AGENDA 03 BUSINESS STRATEGY & DIRECTION 04 DIVIDEND POLICY 05 FY2020 OUTLOOK 06 APPENDIX
Slide 14: 4 Strategic Pillars
REIMAGINING TNB TNB's strategic aspiration – a key enabler is the corporate structure 4 STRATEGIC PILLARS 4 STRATEGIC PILLARS Future Generation Grid of the Future Future Winning the Customer Sources Proof Regulations • Upgrading existing network • Growing TNB’s renewable infrastructure into a smart,
Slide 15: TNB RE Target of 1,700MW by 2025
TO BE A LEADING PROVIDER OF SUSTAINABLE ENERGY SOLUTIONS IN MALAYSIA AND INTERNATIONALLY Our pledge in powering the lives of our customers and communities through renewable energy, supporting Malaysia’s commitment in reducing the GHG emission intensity and environmental impact Government Green Devel
Slide 16: TNB's RE Strategy and Capacity
TO BE A LEADING PROVIDER OF SUSTAINABLE ENERGY SOLUTIONS IN MALAYSIA AND INTERNATIONALLY Our journey towards transitioning into a cleaner and sustainable energy provider TNB’s RE Capacity TNB’s RE Strategy WIND International: International • UK (TNB Wind Ventures): 26 MW 144 MW • Turkey (GAMA): 118
Slide 17: Transitioning Away from Coal Related Revenue
TRANSITIONING AWAY FROM COAL RELATED REVENUE The Group is committed to ensure that the revenue from the coal generation plants does not exceed 25% Breakdown of TNB's Group Revenue 0.2% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 2.6% 2.4% 2.7% 2.7% 2.6% 2.0% 1.8% 1.7% 12.6% 13.0% 10.8% 10.5% 11.0% 10.4% 11.4
Slide 18: TNB's Environmental Initiatives
TNB’S ENVIRONMENTAL INITIATIVES TNB Board of Directors is cognisant of the importance of ensuring sustainability is integrated in the strategic direction of the organisation, decision making processes and operational performance Developed Green House Gas Emission The latest coal generation plants us
Slide 19: Agenda
01 INTRODUCTION TO TENAGA 02 REGULATORY AGENDA 03 BUSINESS STRATEGY & DIRECTION 04 DIVIDEND POLICY 05 FY2020 OUTLOOK 06 APPENDIX
Slide 20: Dividend Policy
DIVIDEND POLICY Distribution of dividend is based on 30% to 60% dividend payout ratio, based on the reported Consolidated Net Profit Attributable to Shareholders After Minority Interest, excluding Extraordinary, Non-Recurring items Current dividend policy effective FY2017 25% 27% 25% 50% 50% 56% 59%
Slide 21: Agenda
01 INTRODUCTION TO TENAGA 02 REGULATORY AGENDA 03 BUSINESS STRATEGY & DIRECTION 04 DIVIDEND POLICY 05 FY2020 OUTLOOK 06 APPENDIX
Slide 22: FY2020 Outlook: Electricity Demand
FY2020 OUTLOOK • Due to the MCO and Covid-19 pandemic, demand for Apr’20 fell by 15.7%. • Since the implementation of Conditional Movement Control Order (CMCO), demand has started to pick up as more businesses were allowed to operate. Electricity • Moving forward, demand and sales are expected to fu
Slide 23: FY2020 Outlook: International Business
FY2020 OUTLOOK • For 2020, we will be executing a strategy aimed at either protecting or creating value from existing assets. • Part of this strategy involves executing a growth strategy focusing on growing TNB’s international Renewable Energy (RE) business leveraging on existing assets, capabilitie
Slide 24: Agenda
01 INTRODUCTION TO TENAGA 02 REGULATORY AGENDA 03 BUSINESS STRATEGY & DIRECTION 04 DIVIDEND POLICY 05 FY2020 OUTLOOK 06 APPENDIX
Slide 25: Electricity Demand by Sector
APPENDIX Electricity Demand by Sector - Lower electricity demand mainly from sluggish industrial and commercial sectors 2Q main contributors for the drop Commercial Industrial Industrial: Y-o-Y (15.3%) Y-o-Y (14.6%) • Iron and steel • Cement products • Electric & electronic (0.1%) (28.3%) (7.5%) (22
Slide 26: IBR – ICPT Mechanism Ensures TNB Remain Neutral
APPENDIX Incentive Based Regulation (IBR) – Imbalance Cost Pass-Through (ICPT) Mechanisms Ensures TNB Remain Neutral Base Tariff under IBR framework comprises of: a) Opex, Depreciation of Regulated Assets & Tax Expenses of Business Entities - transmission, grid system operation, Single Buyer operati
Slide 27: IBR – ICPT Comprises Two Components
APPENDIX Incentive Based Regulation (IBR) – Imbalance Cost Pass-Through (ICPT) Comprises Two Components Imbalance Cost Pass-through (ICPT) Fuel Cost Pass Through (FCPT) Generation Specific Cost Adjustment (GSCPT) Changes in Gas/LNG and Coal Costs Changes in: PPAs Power Purchase Agreements • Other fu
Slide 28: IBR – New Features in Tariff Review for RP2
APPENDIX Incentive Based Regulation (IBR) – New Features in Electricity Tariff Review for RP2 (2018-2020) * Source: Energy Commission (EC) 28 28
Slide 29: IBR – IBR Entities
APPENDIX Incentive Based Regulation (IBR) – IBR Entities 1 1 In RP1, these 2 entity are grouped as Price –Cap entity Source: Energy Commission (EC) 29 29
Slide 30: IBR – Generation and Customer Mix
APPENDIX Incentive Based Regulation (IBR) – Generation and Customer Mix Generation Mix RP1 vs RP2 Changes in Customer Mix (%) in RP1 (2015-2017) RP1 Base RP1 Actual 43.6% 40.8% Coal Coal 44% 49% 35.1% RP2 1% 1% 0.1% 34.1% 4% Coal Gas 20.6% 22.3% 33% Hydro 61% RE Base IBR RP1 Average Actual IBR RP1 L
Slide 31: International Acquisition
APPENDIX International Acquisition - Four International Acquisitions to Support Aspiration 30% 30% Equity interest of GAMA Enerji A.S. Equity interest of GMR Energy Limited. Assets include a 853MW natural gas- Assets include 1,915MW coal, gas and fired plant, 117.5MW wind plants and solar plants. 13
Slide 32: Existing TNB Renewable Energy Assets
APPENDIX Existing - TNB’s Renewable Energy (RE) Assets Others Domestic (Peninsular Malaysia) International Mini Hydro (22MW) ⚫ Kelantan ⚫ GSPARX Rooftop Solar (56MW) United Kingdom (Total secured) Large Hydro ⚫ SJ Pergau (600MW) Solar ⚫ TNB Vortex Solar (365.0MW) Kedah Terengganu Wind Large Scale So
Slide 33: TNB's Environmental Initiatives - Green Development
APPENDIX TNB’s Environmental Initiatives - Green Development ❑ UNITEN’s Smart UniverCity ❑ Expansion of Electric Vehicle Charging Network ✓ To create a sustainable ecosystem which provide competitive advantage for TNB in moving into smart city environment. ✓ To expand the existing charging station i
Slide 34: TNB's Social Initiatives
APPENDIX TNB’s Social Initiatives Economic & Social Education Career Development 212 households benefitted from Projek Baiti Jannati and 700 students awarded More than RM183 Program Mesra Rakyat by YTN scholarship with a million contributed in refurbishing or building new total amount of RM66.1 trai
Slide 35: TNB's Governance Initiatives
APPENDIX TNB’s Governance Initiatives TNB is committed to operating in an ethical, transparent and responsible manner given the critical role we play in national development and the number of stakeholders who are impacted by our business TNB Board Committees Governance Pillars Board Audit Committee
Slide 36: Composition of Board of Directors
APPENDIX TNB’s Governance Initiatives - Composition of BOD CHAIRMAN EXECUTIVE DIRECTOR / CEO DATO’ SERI DIRAJA MAHDZIR KHALID DATUK SERI AMIR HAMZAH BIN AZIZAN Independent Non-Executive Directors (Total = 7) Non-Independent Non-Executive Directors (Total =2) NORAINI BINTI CHE DAN ONG AI LIN GOPALA K
Slide 37: Capital Management
APPENDIX Capital Management - New drawdown & FOREX translation increased the gearing, but within the optimal level Statistics 30th Jun'20 31st Dec'19 RM Equivalent of Loan Value (bil) 1 Total Debt (RM' Bil) 47.3 45.4 Net Debt (RM' Bil)* 35.9 31.2 76.1% 1 Gearing (%) 45.8 43.4 Net Gearing (%) 34.8 29
Slide 38: Financial Highlights
APPENDIX Financial Highlights REVENUE (RM bil) EBITDA (RM bil) 50.4 50.9 47.4 18.4 44.5 14.8 15.5 13.4 22.5 9.3 FY'16 FY'17 FY'18 FY'19 1HFY'20 FY'16 FY'17 FY'18 FY'19 1HFY'20 PAT (RM bil) 7.32 6.91 4.45 3.75 1.41 FY'16 FY'17 FY'18 FY'19 1HFY'20 Note: FY2019 is after MFRS16 implementation 38 38
Slide 39: Technical Highlights
APPENDIX Technical Highlights EAF (%) Transmission System Minute (mins) 04 05 89.9 1.5 88.1 88.5 88.2 83.4 0.4 0.3 0.2 0.0 FY'16 FY'17 FY'18 FY'19 1HFY'20 FY'16 FY'17 FY'18 FY'19 1HFY'20 Distribution SAIDI (mins) 49.7 50.2 48.2 48.1 44.2 FY'16 FY'17 FY'18 FY'19 1HFY'20 39 39
Slide 40: Disclaimer
DISCLAIMER All information contained herein is meant strictly for the use of this presentation only and should not be used or relied on by any party for any other purpose and without the prior written approval of TNB. The information contained herein is the property of TNB and it is privileged and c
Slide 41: Thank You
THANK YOU For further enquiries, kindly contact us at: Investor Relations Office: Investor Relations Team: Ms. Mehazatul Amali Meor Hassan CoE Investor Relations +603 2108 2126 Group Finance Division Tenaga Nasional Berhad mehazatul@tnb.com.my 4th Floor, TNB Headquarters Ms. Sakinah Mohd Ali No.129,
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