YTLPOWER Latest Result & Dividends

YTLPOWER released their latest quarterly report today with an announcement of a share dividend of 1:40 normally reserved for December. On top of that a cash dividend of 7.5% of RM0.50 par vale is proposed for shareholders approval.

Revenues remain quite steady QoQ but is slightly lower than previous quarter although net profit is slightly higher. Quarterly EPS is on a rise with a end of year EPS of 19.99 cents for June 2008. Looking at the segmental revenue report, Wessex Water continues to be their main revenue contributor of RM1.404 billion or 72% of their total revenues for this last quarter.

Nothing in the report indicate any payments of Windfall Tax because it was only due after July 1st which would probably be represented in the next quarterly report. The report did not say how it would affect their bottom line other than saying prospects will be satisfactory "save and except for the impact of the 30% Windfall tax imposed". This doesn't sound too optimistic at all of their prospects of evading that tax. From my last post, it was already reported in The Edge Daily that YTLPOWER has already paid their 1st installment of the tax but it does not state how much.

One of the more interesting aspect of the report was an enormous increase of cash flow from RM6 bil last year to the current RM9 bil this year ending. The most current financial activity was the RM2.2 billion warrant offer which could explain where the bulk of the cash comes from. The other RM1 bil could be from operational revenues. Quite a sum accumulated so far and hopefully they can put it to good use in more acquisitions.

On a side note, the share dividends which is traditionally distributed in December is somehow brought forward to September. The dividend distributed is also lesser maybe due to increased share outstanding. And on top of that a cash dividend is also proposed. This is good in terms of the share dividend to be distributed in September will most likely precede the cash dividends. So shareholders will actually get a little extra because their new share dividends are also entitled to the proposed cash dividends.

It would seem as though the company is rushing out the dividends for some reason. It could very well be that the Windfall Tax would have an effect on their financials from now on. Whatever their reason, YTLPOWER as it is has some changes already to how it would operate whether in terms of the new Windfall Tax or future PPA negotiations or even and I would hope new acquisitions.


Edit:
Correction; The RM2.2 billion in additional cash is not from the warrant issue but from a bond issue which was held at the same time the warrants were sold. The bonds expire on 2013. The warrants will still bring in cash from the conversion price of RM1.25 whenever the warrants are exercised.