KUALA LUMPUR: Khazanah Nasional Bhd will double its dividend payment to the government to RM1 billion for 2023 from RM500 million in 2022 after profit from operations surged more than threefold last year.
The profit stood at RM5.9 billion compared with RM1.6 billion in 2022, amid challenging and volatile global markets, said Khazanah group managing director Datuk Amirul Feisal Wan Zahir.
Cumulatively, the sovereign wealth fund has paid RM18.1 billion in dividends since 2004.
Amirul Feisal said the higher profit was driven by higher dividends and distributions from investee companies, fair value gains and capital preservation.
The fund said its realisable asset value (RAV) over debt ratio remained healthy at 2.7 times, while net asset value (NAV) grew from RM33 billion in 2004 to RM85 billion in 2023.
This resulted in a compound annual growth rate of 5.1 per cent, fulfilling Khazanah's mandate to deliver sustainable returns to the nation and growing Malaysia's long-term wealth.
"The investment portfolio achieved a five-year rolling NAV time-weighted rate of return (TWRR) of 2.9 per cent and a one-year NAV TWRR of 5.7 per cent amid the challenging market landscape.
"The returns improved in 2023, driven by the developed market portfolio and a partial recovery of our listed investee companies in Malaysia," he said at a media briefing on the Khazanah Annual Review yesterday.
Amirul Feisal also said Khazanah's airline and tourism assets showed improved financial and operational performance.
Malaysia Aviation Group (MAG) recorded a positive net income after tax for the first time in a full year, while Destination Resorts and Hotels made a strong recovery post-pandemic.
No additional capital injections were required for both assets during the year.
Khazanah, the sole shareholder of Malaysia Airlines Bhd (MAB) via MAG, signalled its readiness to explore avenues to bolster the national carrier's growth strategy.
When queried about the possibility of new partners for MAB, Amirul Feisal said: "We are open to all methods to achieve our strategy."
He highlighted Malaysia Airlines' resilience and strategic planning, noting its focus on capital and cost structure, including reducing fixed costs and improving cash generation.
The airline is also investing in product development, people, engineering and operations.
Additionally, efforts to replace ageing aircraft are underway, though delays are expected due to global supply chain challenges.
Regarding ownership, Amirul Feisal emphasised the importance of strategic decision-making without knee-jerk reactions.
He mentioned positioning Malaysia as an economic hub, highlighting opportunities to strengthen long-haul routes.
This includes exploring partnerships, business arrangements and equity considerations.
"Now the focus is on building products that everyone can be proud of, and product development includes people, engineering and operations. That is still ongoing."
Amirul Feisal said 2024 is expected to be yet another challenging year globally with heightened political uncertainties amid conflicts in the Middle East, the Russia-Ukraine war and competition between China and the United States.
Additionally, he said a significant global election cycle involving 76 countries representing over 60 per cent of the world's gross domestic product will introduce further volatility.
"In this environment, Khazanah remains vigilant in its investment activities to maintain portfolio resilience through strategic diversification.
"Advancing Malaysia will remain our overarching theme to steer our strategies and actions towards delivering national development and ensuring a sustainable future for Malaysia."
Khazanah deployed RM7.3 billion in new investments and raised RM7.2 billion from asset monetisation for 2023. Its debt increased marginally to RM50.2 billion from RM49.1 billion in the previous year.
On Dana Impak, he said Khazanah has identified projects worth over RM800 million across six key themes, with new programmes launched to bolster Malaysia's digital and startup ecosystem via financial investments and human capital development.
The initiatives include the Future Malaysia Programme, Future Malaysia Skills, MSME Digitalisation and Khazanah Impact Innovation Challenge 2023.
They underscore Khazanah's commitment to investing in catalytic sectors.
"These efforts aim to enhance Malaysia's economic competitiveness and socioeconomic benefits, reinforcing Dana Impak as one of the key pillars under the Advancing Malaysia strategy," he added.