KUALA LUMPUR (Aug 29): Tenaga Nasional Bhd's (TNB) (KL:TENAGA) net profit for the second quarter ended June 30, 2024 (2QFY2024) jumped more than fourfold to RM1.45 billion from RM327.9 million a year ago, as it recorded higher electricity sales, a favourable foreign exchange translation, and lower net finance costs.

Operating profit for the quarter rose 19.9% year-on-year (y-o-y) to RM2.24 billion from RM1.87 billion, primarily due to a smaller negative fuel margin — a negative margin basically indicates that the cost of fuel used to generate electricity is higher than the revenue it earns from selling the electricity — amid more stable coal prices.

Quarterly revenue grew 7.83% y-o-y to RM14.4 billion from RM13.3 billion, driven by a 5.7% or RM745.8 million increase in electricity sales. The group recorded a forex translation gain of RM130.2 million in 2QFY2024, versus a forex translation loss of RM453.5 million in 2QFY2023, while finance cost dropped by nearly RM133 million to RM1.01 billion.

The improved bottom-line performance resulted in earnings per share increasing to 24.95 sen from 5.70 sen a year earlier, according to the utilities giant's filing with the bourse.

TNB proposed an interim single-tier dividend of 25 sen per share, higher than the 18 sen per share it declared a year earlier, with payment dates to be announced in due course.

As of the end of June, TNB’s receivables, deposits, and prepayments stood at RM12.1 billion, up 16.7% from RM10.4 billion at the end of December 2023, while deposits, bank, and cash balances decreased by 8.87% to RM17.7 billion from RM19.39 billion.

For the six-month period ended June 30, 2024 (6MFY2024), TNB's net profit jumped 62.4% y-o-y to RM2.16 billion from RM1.33 billion, with revenue up 7.9% y-o-y to RM28 billion from RM25.9 billion.

The utilities giant noted that the imbalance cost pass-through (ICPT) under-recovery fell to RM5.16 billion for 6MFY2024, from RM6.49 billion in the same period the previous year, due to a lower negative fuel margin.

TNB is anticipating stable performance for the rest of FY2024, given that the Malaysian economy is projected to grow between 4% and 5%.

The group also reaffirmed its commitment to playing an integral role in supporting the National Energy Transition Roadmap.

At the closing bell on Thursday, TNB's shares dipped six sen or 0.4% to RM13.94, giving it a market capitalisation of RM81 billion. The stock has gained nearly RM4 or 40% year to date.