Apr 6, 2010

TENAGA : TARIFF INCREASE WON'T LEAD TO HIGHER EARNINGS

TNB: Tariff increase won't lead to higher earnings
Tenaga Nasional Bhd (TNB) (TNB MK, Buy, TP:RM9.90) will not get additional profit should the government decide to allow it to raise the electricity tariff to compensate for increase in fuel prices, its chief executive officer Datuk Seri Che Khalib Mohamad Noh said. "When fuel prices increase, we have to pass (the extra cost) to consumers or else, we cannot sustain," he said. This passing of higher fuel cost to consumers is not new here as a fuel-pass through formula was introduced in 1996 but suspended two years later as a result of the Asian financial crisis, he added. (BT)