Latest news with #Malakoff
The Star
9 hours ago
- Business
- The Star
Strong power demand to fuel Malakoff prospects
PETALING JAYA: The RM40mil provision Malakoff Corp Bhd made for its coal inventory in the second half of the year (2H25) may be reversed to some extent in the second half of the year should coal prices rise. The independent power producer (IPP) made the provision in its first quarter ended March 31, 2025 (1Q25) financials which resulted in its earnings for the period falling 45% year-on-year (y-o-y) to RM34mil. OUB Kay Hian (UOBKH) Research expected Malakoff to write back some of the provisioning in the later part of the year should coal prices recover. Malakoff's revenue for the quarter eased 11% y-o-y to RM2bil due to lower dispatch because of lower economic activity in Peninsular Malaysia in the period, it added. Its overall dispatch to the grid was also lower by 6% y-o-y with lower offtake for its gas-fired power plants. 'The coal-fired power plants experienced lower energy payment due to a drop in coal prices,' the research house stated in a report following the release of the IPP's 1Q25 results. UOBKH Research lowered its net profit forecast for Malakoff for financial year 2025 (FY25) by 9% to capture the RM40mil provisioning and it expected the company to post a net profit of RM276mil for the year, which would be relatively flat y-o-y. It however kept its 'buy' rating on Malakoff with a target price (TP) of RM1.08 a share. 'In arriving at our TP, we have included a 1,400MW thermal power plant win. Our blue-sky fair value is RM1.25 per share, in the event Malakoff wins two 1,400MW power plants,' it noted. CGS International (CGSI) Research said Malakoff would submit bids to extend the commercial life of expired and expiring gas power plants – GB3 (640MW), Prai Power (350MW), and Segari (1,303MW) – under the Energy Commission's recently launched tender, which closes in June. 'Management also clarified that this new tender will not impact the initial letter of notifications it has already received for two new gas-fired power plants, which are progressing toward formalisation. Construction of the group's 84MW small hydro project in Kelantan is progressing well,' CGSI Research stated. It added Malakoff had completed the acquisition of a 49% stake in E-Idaman Sdn Bhd (which gives it exposure to waste management services in Perlis and Kedah) in February, and the company contributed some RM2mil to Malakoff's 1Q25 net profit figure. CGSI Research has also maintained its 'add' call on Malakoff with a lower sum-of-parts based TP of RM1.15 a share on the belief the group's valuation remains undemanding supported by net yields of above 5.5%. 'Malaysia's energy transition drive also improve Malakoff's prospects for new plant awards, thus supporting long-term earnings,' the researc house said. Rerating catalysts include the final investment decisions on projects in the pipeline, repowering of existing power assets and recovery in its dividend payout. Risks include return of negative fuel margins and unplanned plant outages. Kenanga Research, meanwhile, cut its FY25 and FY26 earnings forecasts by 24% and 25% respectively, to reflect the provisioning impact. It, however, kept its 'market perform' recommendation on the counter with a reduced TP of 77 ssen (from 80 sen) which is supported by a decent dividend yield of above 4%.
The Star
7 days ago
- Business
- The Star
Malakoff's 1Q net profit drops 45%
Malakoff's Tanjung Bin power plant in Johor KUALA LUMPUR: Malakoff Corp Bhd's net profit tumbled 45.3% to RM33.9mil in the first quarter ended March 31, compared with RM62.2mil in the year-ago quarter. The independent power producer said the lower profit was primarily due to lower positive fuel margin recorded at Tanjung Bin Power Sdn Bhd (TBP) in line with the decline in applicable coal price (ACP), higher net realisable value provision for coal inventories and lower contribution from Prai Power Plant Sdn Bhd following a reduction in the revised tariff from the extended power purchase agreement (PPA). Revenue for the quarter declined to RM2.03bil from RM2.28bil, while earnings per share slipped to 0.14 sen compared with 0.79 sen previously. It said the lower revenue was primarily due to lower energy payments recorded from TBP and Tanjung Bin Energy Sdn Bhd (TBE) in line with the decline in ACP as well as lower energy payment recorded from Segari Energy Ventures Sdn Bhd (SEV), given the decrease in despatch factor. Malakoff expects its overall performance to remain satisfactory for the financial year ending Dec 31, 2025. It noted that global coal prices are expected to decline in early 2025 due to lower coal imports by some developing countries, including reduced demand from China driven by cheaper domestic coal and increased hydropower. As such, a higher provision for net realisable value for coal inventories has been accounted for during the current quarter under review. 'The group's thermal assets continue to focus on operational efficiencies to enhance reliability and availability to mitigate any impact from fluctuations in global coal prices,' it said.
New Straits Times
7 days ago
- Business
- New Straits Times
Malakoff posts RM34mil net profit on RM2.203bil revenue in Q1
KUALA LUMPUR: Malakoff Corporation Bhd posted a net profit of RM34.0 million for the first quarter ended March 31 2025 compared to RM62.0 million a year ago. Its revenue stood at RM2.03 billion, down RM252.2 million or 11.1 per cent from RM2.28 billion in the corresponding quarter last year. The lower revenue was primarily due to lower energy payments from Tanjung Bin Power Sdn Bhd and Tanjung Bin Energy Sdn Bhd following a reduction in the applicable coal price as well as lower energy payments from Segari Energy Ventures Sdn Bhd in line with a reduced despatch factor. "These factors, along with a lower positive fuel margin at Tanjung Bin, higher net realisable value provision for coal inventories and a reduced contribution from Prai Power Sdn Bhd following the downward tariff revision under the extended power purchase agreement (PPA), impacted the group's net profit," Malakoff said. The group said contribution from environmental solutions was encouraging. Although the tonnes of waste collected under the concession business dropped 0.4 per cent compared to Q1 FY2024, waste handled under the non-concession business increased by 71 per cent year-on-year contributing to the group's net profit for the quarter under review. Malakoff managing director and group chief executive officer Anwar Syahrin Abdul Ajib highlighted its continued momentum in strengthening power generation, expanding its renewable energy (RE) footprint and advancing environmental solutions as part of its strategic shift towards sustainable growth. "We are observing a softening in global coal prices, largely driven by lower demand from major markets such as China and India. "While this trend may result in moderated energy payments from our coal-based assets, we view it as part of the broader global energy transition. 'In line with this, we continue to monitor the current price trend and remain focused on enhancing operational efficiency and plant reliability. These efforts reflect our continued commitment to maintaining business resilience while supporting the nation's energy needs in an evolving market landscape". He said the group continued to focus on its operational performance to ensure sufficient energy consumption for the country. In Q1 FY2025, the percentage of energy sold to the national grid in Peninsular Malaysia was more than 23 per cent of the total electricity generated. This was made possible through improved efficiency mainly due to minimum scheduled outages in the quarter in addition to the unwavering commitment of its site personnel. Malakoff said it continues to strengthen its RE portfolio through strategic financing and project execution. Earlier this year, its wholly-owned Malakoff Power Bhd issued the group's inaugural RM250.0 million Asean Sustainability SRI sukuk Murabahah under a RM1.2 billion Islamic medium-term notes. This is Malakoff's first sustainability offering under its Asean Sustainability SRI sukuk Murabahah and the first of its kind by an independent power producer in Malaysia. The proceeds from the issuance will fund eligible projects under Malakoff's sustainable finance framework, established in December 2023. On the project front, Malakoff Radiance Sdn Bhd formalised a solar PPA with Mardec Bhd for rooftop photovoltaic installations at five sites across Peninsular Malaysia. Malakoff Radiance also signed a second solar PPA with HICOM Automotive Manufacturers (Malaysia) Sdn Bhd, marking its largest single-site solar deployment to date at 4.22 MWp. This builds on the success of the first phase, a 2.0 MWp system at the same Pekan facility, which has reduced grid electricity consumption by about 7.0 GWh and avoided nearly 5,489 tCO2e in emissions, equivalent to the carbon absorption of 261,000 trees". On the environmental solutions front, Alam Flora Environmental Solutions Sdn Bhd in February secured a three-year contract renewal with Keretapi Tanah Melayu Bhd for train cleaning and sleeperette preparation services, reinforcing its strong track record in growing non-concession segments. Subsequently, on Feb 28, Malakoff, through its wholly-owned subsidiary Tuah Utama Sdn Bhd, completed the acquisition of a 49 pecent stake in E-Idaman Sdn Bhd, increasing the group's total effective waste management capacity close to 5,200 tonnes per day. This milestone further supports its long-term goal of managing 10,000 tonnes per day by 2031.
The Sun
06-05-2025
- Business
- The Sun
Malakoff issues inaugural RM250m Asean green sukuk
KUALA LUMPUR: Malakoff Corporation Bhd, through its wholly owned subsidiary Malakoff Power Bhd (MPower) has issued its inaugural RM250 million Asean Sustainability SRI Sukuk Murabahah (Issuance) under its RM1.2 billion Islamic Medium-Term Notes Programme (IMTN). This is Malakoff's first sustainability offering under its Asean Sustainability SRI Sukuk Murabahah and the first by an independent power producer in Malaysia. The proceeds from the issuance shall be utilised to finance eligible projects by MPower, Malakoff and its subsidiaries, in accordance with Malakoff's Sustainable Finance Framework, which has been in place since December 2023. Maybank Investment Bank Bhd (Maybank IB) acted as the sole lead manager and facility agent while Maybank Islamic Bhd was the shariah adviser for the Issuance. Maybank IB was also the sustainability structuring adviser for Malakoff's Sustainable Finance Framework. As part of its broader commitment to sustainability and energy transition, Malakoff in a statement yesterday said it has made significant strides over the past year in advancing its sustainability commitment. The group achieved a 3.7% year on-year reduction in greenhouse gas emissions intensity moderately contributed as well by a 17.0% reduction in Scope 2 emissions with respect to the Group's electricity consumption. It also launched its flagship Biomass Co-firing Project at the 2,100 MW Tanjung Bin Power Plant for a trial run under the National Energy Transformation Roadmap. The project achieved a 2% biomass co-firing ratio. Malakoff is committed to scale up the biomass co-firing to a higher ratio of 15% by 2027. This milestone is projected to reduce carbon dioxide (CO₂) emissions by approximately 755,000 tonnes annually, which is equivalent to the carbon offset of 142 million mature trees. In parallel, the group commenced construction of three run-of-river small hydropower plants along Sungai Galas in Kelantan, expected to offset a further 272,424 tonnes of CO₂ per year. The group also continued expanding its renewable energy (RE) portfolio, achieving 173 MW in total RE capacity – a 496.6% increase from its 2021 baseline. This includes 17.4 MWp of completed commercial and industrial solar installations and the acquisition of equity stakes in ZEC Solar Sdn Bhd (51%) and TJZ Suria Sdn Bhd (49%), contributing an additional 29 MW. Malakoff managing director and group CEO Anwar Syahrin Abdul Ajib (pic) said: 'This transaction marks a significant milestone for Malakoff Power, as it represents our first Asean Sustainability SRI Sukuk Murabahah issuance via a book-building exercise under our IMTN Programme. 'Given that MPower's last public sukuk issuance was in December 2013, we are very encouraged by the strong demand from a diverse investor base for this issuance, which has set a new pricing benchmark for MPower. 'Looking ahead, Malakoff will continue to broaden its assets portfolio through strategic partnerships and circular economy initiatives. 'As a trusted partner in Malaysia's green transition, we remain focused on strengthening capabilities, enhancing efficiencies and delivering long-term value in an evolving energy landscape'. On the back of growing demand for sustainability assets and the scarcity value of Sukuk offerings by MPower, the transaction was oversubscribed by 10.34 times. Supported by the strong orderbook, the price guidance was revised and tightened multiple times. The issuance was finally priced at MGS +70 basis points across both tenures of 7 and 10 years, which is 30 basis points lower than the upper end of the initial price guidance. Maybank Investment Bank Bhd CEO Michael Oh-Lau said: 'Maybank Investment Bank is proud to have lead-managed and advised Malakoff Power's maiden Asean Sustainability SRI Sukuk Murabahah issuance, underscoring our commitment to be a sustainability leader in the region. 'The strong response from investors is testament of the market's confidence in Malakoff as well as Maybank IB's ability to secure strong participation despite market seasonality. 'The pricing outcome also positions this landmark transaction as one of the lowest spreads for a corporate within the AA-/AA3 rating band in recent times.'
New Straits Times
06-05-2025
- Business
- New Straits Times
Malakoff unit issues RM250mil Asean Sustainability Sukuk
KUALA LUMPUR: Malakoff Corp Bhd's unit Malakoff Power Bhd (MPower) has issued its inaugural RM250 million Asean Sustainability SRI Sukuk Murabahah under its RM1.2 billion Islamic medium-term notes programme. This marks the group's first sustainability offering under its Asean Sustainability SRI Sukuk Murabahah and the first by an independent power producer in Malaysia. The proceeds from the issuance will be utilised to finance projects by MPower, Malakoff and its subsidiaries, in accordance with Malakoff's sustainable finance framework. Malakoff managing director and group chief executive officer Anwar Syahrin Abdul Ajib said this is a significant milestone for MPower, as the group's last sukuk issuance was in December 2013. "We are very encouraged by the strong demand from a diverse investor base for this issuance, which has set a new pricing benchmark for MPower. Looking ahead, Malakoff will continue to broaden its assets portfolio through strategic partnerships and circular economy initiatives. "As a trusted partner in Malaysia's green transition, we remain focused on strengthening capabilities, enhancing efficiencies and delivering long-term value in an evolving energy landscape," he said in a statement. The transaction was oversubscribed by 10.34 times, backed by growing demand for sustainability assets and the scarcity value of sukuk offerings. Malakoff said the price guidance was revised and tightened multiple times, supported by the strong orderbook. The issuance was priced at 70 basis points above the Malaysian Government Securities yield for both the seven- and 10-year tenures, which is 0.30 percentage point lower than the upper end of the initial pricing guidance. Over the past year, Malakoff achieved a 3.7 per cent year-on-year reduction in greenhouse gas emissions intensity, partly supported by a 17 per cent drop in Scope 2 emissions related to the group's electricity consumption. Its other notable sustainability commitments include its flagship Biomass Co-firing Project at the 2,100 megawatt Tanjung Bin Power Plant for a trial run under the National Energy Transformation Roadmap. Malakoff is committed to scale up the biomass co-firing to a higher ratio of 15 per cent by 2027. This is projected to reduce carbon dioxide emissions by approximately 755,000 tonnes annually.
