KUALA LUMPUR: The Armed Forces Fund Board (LTAT) has announced a five per cent dividend for the fiscal year ending Dec 31, 2023, marking a total payout of RM485.05 million, a slight increase from RM476.45 million the previous year.
Defence Minister Datuk Seri Mohamed Khaled Nordin highlighted that this marked the second consecutive year of a five per cent dividend rate.
He emphasised the positive trend, noting a significant recovery from the lowest dividend rate of two per cent in 2018.
"The dividend announcement today is based on LTAT's strong financial position with the overall combination of its reserves recording a consistently positive financial position.
"LTAT also consistently ensures that its solvency rate remains at not less than 100 per cent when declaring its annual dividends to contributors to ensure LTAT's ability to fulfil its financial obligations at all times.
"Furthermore, the dividend rate announced reflects a positive development for LTAT as it has successfully provided a gradually recovering, sustainable and stable dividend rate," he said before launching the dividend announcement event here.
For the year under review, LTAT recorded an improved year-on-year performance in its key financial indicators.
The total income of RM738.02 million, an increase of 13 per cent against the preceding year, was mainly attributed to contributions from public equity and private equity investments and is represented by all-cash income.
The net profit of RM537.80 million represents more than a 24 per cent increase as compared with RM432.47 million in 2022.
LTAT also recorded RM756.81 million in retained earnings (post-dividend) for the year under review, which marks a significant increase of 52 per cent as compared with 498.65 million in the preceding year.
Last year's dividend was distributed to 123,380 contributors today.
Meanwhile, Khaled reaffirmed the Defence Ministry's commitment to being the driving force for LTAT to become an organisation that contributes to the country's economic development and ensures social protection for army personnel.
"LTAT is committed to practising prudent and meticulous cash flow management to fulfil its obligations of repaying retirement savings to LTAT contributors.
"Next, the Ministry, together with LTAT, will focus on implementing strategies outlined in the MAMPAN25 Plan and exploring new strategies to enhance LTAT's performance. This includes restructuring business models and shareholdings in strategic companies.
"We aim to optimise LTAT's performance with the best business model while safeguarding strategic interests in various high-potential entities.
"All plans and strategies will be executed carefully, inclusively, and considering the views and ideas of various stakeholders," he said.
Regarding LTAT's negative reserve as reported in the Auditor General's 2022 report, which sparked criticism, Khaled said such a matter should be researched with due diligence before jumping to any conclusions.
"People believe in sensational news. We wouldn't do an announcement like this if (LTAT) did not have a strong financial position.
"In any case, we ask those responsible (for criticisms) to not listen from one side and wait a long time before asking."
In March, the auditor general flagged LTAT for diminishing investment returns in two subsidiaries.
In a statement on the report, Datuk Wan Suraya Wan Mohd Radzi also flagged LTAT's decision to pay dividends derived from non-cash profits to contributors.
Khaled then clarified that the reserve for 2022 was positive as the report only highlighted one of its three reserve funds.