By NG MIN SHEN / Pic By MUHD AMIN NAHARUL
Malakoff Corp Bhd recorded lower earnings for the final three months of 2017 as the power purchase agreement (PPA) revision hurt revenues from the Segari Energy Ventures Sdn Bhd gas plant.
Malaysia’s largest independent power producer recorded a net profit of RM43.72 million for the October-December 2017 period, lower than the RM90.23 million posted a year ago.
The company told the stock exchange yesterday that the PPA revision commencing July 1, 2017, for the Segari power plant had contributed to the 51.5% drop in earnings for the quarter.
The drop is also contributed by the lower contribution from the Tanjung Bin Energy Sdn Bhd coal plant caused by unscheduled plant outages.
However, these drops were partially moderated by the higher fuel margin recorded at the Tanjung Bin Power Sdn Bhd and Tanjung Bin Energy coal plants as a result of higher applicable coal prices.
Revenue for the quarter, however, inched higher to RM1.79 billion compared to RM1.71 billion posted in the previous, primarily due to higher energy payment recorded at the Tanjung Bin Power and Tanjung Bin Energy coal plants on the back of higher applicable coal price.
For the financial year ended Dec 31, 2017 (FY17), the group’s net profit slipped 12.8% to RM309.95 mi l l ion from RM355.46 million posted a year ago, largely due to the PPA revision.
The decline was partly moderated by higher fuel margins recorded at both coal plants, compensation payment from settlement of disputes with IHI Corp Japan over Tanjung Bin Power’s boiler failure, and positive performance from associates’ investments overseas.
Revenue for FY17, however, improved 16.9% to RM7.13 billion from RM6.1 billion in FY16.
Malakoff said the power producer is well positioned to benefit from projected domestic demand in the local economy, with the successful commissioning of the Tanjung Bin Energy Thermal Power Plant in March 2016, which had added 1,000MW to its local portfolio of power generation assets, thus increasing its net generat ion capacity to 6,346MW.
“The group will continue to pursue growth opportunities locally to expand its generation capacity, especially the renewable-energy segment.
The group will also continue to explore opportunist ic investment overseas to complement its local generation business,” it said. It expects its performance to remain satisfactory for FY18.