KUALA LUMPUR: Tenaga Nasional Bhd’s (TNB) net profit decreased 14.9 per cent to RM1.96 billion in the third quarter (Q3) ended May 31, 2017 due increase in deferred taxation expense.
The utility company said this was mainly due to higher capitalisation of asset during financial year 2016 and 2017 recognised in the current quarter.
During the same quarter a year ago, TNB has recorded a net profit of RM2.31 billion.
Its revenue in the same quarter increased 3.5 per cent to RM12.55 billion from RM12.13 billion mainly due to an under-recoverability of Imbalance Cost Pass-Through (ICPT) recognised during the current quarter amounting to RM507.1 million as compared to an over-recoverability of RM537.6 million recognised in the corresponding quarter.
For the nine-month period, TNB’s net profit decreased 7.5 per cent to RM5.18 billion from RM5.61 billion due to the increase in finance cost from the recognition of interest in amounts owing to the government and from new borrowings acquired during the current period.
Its revenue in the same period increased 4.9 per cent to RM34.95 billion from RM33.29 billion due to the recoverability of the higher generation costs via the effective implementation of government approved ICPT mechanism.
In a filing to Bursa Malaysia, TNB said the mechanism, a part of the wider regulatory reform called the Incentive Based Regulation allowed the Group to be financially neutral from any variations in generation costs and fuel prices.
It said the over-recoverability of the ICPT recognised during the current period of RM288.8 million is lower as compared to the last corresponding period of RM1.93 billion.
TNB said it remained cautious on the Group’s outlook for the year ending Aug 31, 2017, given the prospect of volatility in the global commodity and energy prices.