KUALA LUMPUR (May 27): Independent power producer Malakoff Corp Bhd's net profit grew 26.6% to RM67 million for the first quarter ended March 31, 2019 (1QFY19) from RM52.91 million a year ago. The improved earnings were attributed to higher payments from electricity generation for its Tanjung Bin Power Sdn Bhd (TBP) and Tanjung Bin Energy Sdn Bhd (TBE) coal power plants.

In a filing with Bursa Malaysia this evening, Malakoff attributed the increase in net profit to the improved contribution from TBE coal plant as there was no unplanned plant outage occurrence during the quarter coupled with lower net finance costs. However, it pointed out that these were partially offset by higher operation and maintenance costs.   

Quarterly revenue expanded by 25% to RM2.007 billion from RM1.604 billion in 1QFY18, supported by higher applicable coal price during the quarter, which led to higher payments for its coal power plants.

Earnings per share improved to 1.37 sen per share compared with 1.06 sen in the previous corresponding quarter.

On its prospects for the financial year ending Dec 31, 2019, Malakoff said the growth in power demand is expected to be sustained driven by industrial and domestic segments, supported by the Government’s continued commitment towards renewable energy (RE).

As such, it said the group expects to expand its RE business portfolio through strategic partnerships.

"The recent 21-year RE Power Purchase Agreement (REPPA) entered into between Green Biogas Sdn Bhd and Tenaga Nasional Bhd (TNB) for the proposed 2.4MW biogas power plant in Kota Tinggi, Johor, will accelerate the group’s expansion into the RE segment," Malakoff said.

Besides that, it pointed out that the improved net energy metering policy has enabled the group to aggressively explore solar installation projects.

Meanwhile, the acquisition of Alam Flora Sdn Bhd, which is expected to be completed by end-2019, will enable the group to expand into high potential waste and environment-related services.

"Based on the foregoing, the group expects performance to remain satisfactory for FY19," it added.

Shares of Malakoff today closed unchanged at 80 sen with a market capitalisation of RM3.91 billion.