Tenaga Nasional Berhad

and correspondingly load utilization has accelerated substantially rising from 845 MW in March 2035 to 1054 MW in March 2036 indicating a steady, robust and highly predictable ramp-up of operational capacity In terms of sales contribution shopping malls, businesses and accommodation services accounted for 18% of total units sold, while other sub-sectors contributed 15%. Data centers currently accounted for 6% of our total sales in the first quarter of 2026. And we are honored to have received the Partnership and Ecosystem Collaboration Team Award at the Data Center Thought Infrastructure Summit 2026. Defaulting our role as a key enabler of Malaysia's digital and data center ecosystem through our Green Lane pathway initiative. Ladies and gentlemen, turning to our technical performance, our sustained operational execution throughout the quarter continues to underpin our earnings resilience, providing a robust foundation for the group's overall performance on generation side, DEF factor, Equivalent plant availability factor has improved significantly to 91.4% versus 82% last year, reflecting stronger plant reliability and operational performance across our generation portfolio. Our network performance continued to remain at world-class level. Our transmission system needs to remain at zero, demonstrating sustained grid reliability and uninterrupted network performance throughout the quarter. For distribution, the System Average Interruption Duration Index, or SAIDI, recorded 11.72 minutes, well within our internal threshold of 47 minutes, reflecting the continuous strength and reliability of our distribution network. Overall, the group's strong technical and operational performance continues to reinforce our earnings, operational stability, and readiness to support growing electricity demand while advancing the nation's Energy Transition Agenda. Moving on to our recent achievement, we continue to strengthen TMB's renewable energy ecosystem through the new BEST deployment, Renewable Energy Expansion and Initiative Supporting Long-Term System Reliability. We successfully completed and commenced operation of the first 100 megawatt 400 MWh Best Santong Project in April 2026. And this marks Malaysia's first grid-connected, full grid-forming best project and was completed ahead of schedule. Demonstrating our execution capabilities while enhancing grid flexibility to support increasing renewable energy penetration and intermittency management. Secondly, our Kenya Hydro Power Station PPA has been extended from 14th of September to 31st of August 2030. This extension further strengthens our system reliability, particularly in the eastern region of Peninsular Malaysia. In addition, under the CRUS program, we completed the execution of bilateral Energy Supply Contract or BAERC with day one in March 2026 for two major renewable energy projects, Centralized Solar Park and Hybrid Hydro-Protecting Solar Projects in Kenya. And lastly, two CGPP projects, namely Setia Kawan Energy and Selarung Pertama Energy, in which we hold 30% equity stake, have successfully achieved their commercial operation date in March and April 2026 respectively. Overall, this initiative further strengthens renewable energy portfolio and supports growing demand for green energy solutions while preserving grid reliability and energy security. Building on TMB's recent operational and strategic achievement, we continue to strengthen our growth momentum through strategic partnerships across digital infrastructure, smart city development and green mobility. Our collaboration with Telecom Malaysia focuses on accelerating green energy and digital infrastructure solutions, while partnership with PKNS supports sustainable urban development through district cooling system initiative in Nusa Alam. Meanwhile, our collaboration with Maybank marks TNB Electron's first partnership with a financial institution, further expanding the EV charging ecosystem and supporting Malaysia's green mobility agenda. And overall, these partnerships reinforce TMB's long-term growth aspirations while supporting Malaysia's broader energy transition agenda. I will now pass to CFO to provide a detailed overview of the first quarter financial performance.

Thank you, Dato'. Well, I hope most of you have seen our numbers last night. so I've seen some reports so the rest of you guys waiting for today I've seen Hazmi and all has smile so I hope the number is satisfactory so we do believe that for our first quarter number we have delivered a stable first quarter profit which is actually driven by overall improvement of our businesses across all division so that's why you have been able to see year on year improvement across revenue EBITDA as well as of the company. So if you look at the revenue line, that's increased almost $1.1 billion to $17 billion. This is, of course, as a result of the increase in sale of electricity, as mentioned by Dato earlier, and volume actually surged by 7% year-on-year in the first quarter, and this was underpinned by data center demand, which continues to be healthy, growing very fast. Of course, it's a small contribution of our sales still, but is growing very fast, doubling the energy usage in one year and demand now already at 1,000 megawatt already. But most importantly, if you look at the malls and businesses just now, which makes up a larger portion of our revenue, continue to grow healthily as well. This is also indication of the overall growth of the economy. And on top of that, of course, we would not deny the fact that the implementation of more cost-reflective RP4 tariffs has actually pushed the revenue so that we are able to recover all the investments that we are doing. So if we move on to EBITDA, you'll see that there is a $335 million increase equivalent to 6.5% to $5.5 billion. So to us, this is important and we're tracking this very closely across the globe because this reflects improve efficiency of the company. So EBITDA margin last year was 32.7%, now it's gone up to 34%. So this is something that is very close to the management where we need to make sure that costs continue to be contained despite scale-up delivery of the CAPEX which is much higher last year and this year. So this additional revenue together with a much more efficient cost control have enabled us to deliver the adjusted core PAP, adjusted for CORREX and MR5S16 of $1.242.5 billion. So that's a 6.5% increase and to us this is a reflection of the fact that most of these earnings are underpinned by the stability of our regulated business. So all in all, I hope you have seen that we have a good start to the year and we will continue to focus on delivery this year together with Prudence Financial Management to deliver the expected financial performance for this year. so moving along if you look at into capital management of the company you should have been able to see as well that we are recording a much lower receivable and actually we are taking a lot of time to make sure that we deploy capital proactively but of course trying to source the most efficient cost of funding as well so this investment are obviously needed for us to continue growing but gearing is a major source of this funding So if you look at our trade receivables compared to March last year, despite a much higher revenue, it's actually lower at $4.1 billion against $4.4 billion that we recorded last year. So this is important because you have seen that this is the success of APA framework, which continue to drive collection efficiencies and obviously giving us a much lower receivable collection as well. So obviously as far as trend is concerned, we are continuing to be very stable below 30 days collection period and that is a major focus for us as well this year. If you look into the second parameter on regulatory receivables, as of December last year, we had 1.9 billion receivables. That has gone significantly down to 0.7 billion only as of March 2026. During the year, we actually received $1.3 billion, which is part of the ICPT payment for April to June last year. If you will recall, RP4 implemented started from January, but we were still on the previous tariff up until June. These are the differences that have been recovered through ICPT. This is obviously a very important payment for us because not only we wanted to reduce the receivables, this is also a reflection of the fact that government continue to honour what is the framework of the IBR so whatever that is due to TMB is recovered through QE funds accordingly so this should give you more confidence that the framework continues to be honoured by government so if we move to the third pillar of strategic fundraising and discipline capital allocation you would notice that in 2025 we actually reduce our cash holdings and pay down a lot of debt to strengthen our balance sheet in 2025. But we know and acknowledge the fact that there is massive investment that needs to be made in 26 and 27. So this year, we are embarking on a lot of fundraising, but we want to make sure that we deploy this capital properly. But this is important for us to spend both regulated and non-regulated capex to fuel the growth of the company going forward. So far, the first issuance we actually did, third issuance of Janko IMTN Sukup program, which was a $10 billion program. We issued another $1.5 billion in March, tenure between 10 to 25 years, and we have been able to sustain quite a good uptake from the investors. So this was actually corporate Sukuk at Genco level but it's being used exclusively for our Nenggiri hydro project as well as Tunai Perak hydro life extension project. So it is green and all the level that is needed for FRI. So that was quite successful. And then in the second program we had our TNB renewable which issued another 1.05 billion ASEAN green FRI Sukuk Wakala This is to fund our LSS-5 development So with the project being actually pure grain sukuk and off-take against TMB's long-term PPA we actually issued multiple tranches of serial maturity from 3, 4, 5 all the way up to 19 years So we got a very good take-up as well This is a project financing at the project level related AA without TMB's corporate guarantee but we actually delivered the funding cost which is equivalent to AAA of PMB's rated category. So this is because we really got a very good demand and we have been able to push everybody into a much lower title margin under a book building process. So with that two programs already done, you would notice as well in April, we established another IMP and Sukup program of RM10 billion. This would be to finance a TMB's regulated business for this year and next year. So we are targeting the first issuance of around RM4 billion, which will be over the next few days. So we do foresee a good take-up as well, and we believe that this is a reflection of the fact that as far as cap tax requirements are concerned, We have a very good demand for the market. The depth of the capital market is there. And despite a little bit of geopolitical tension everywhere else in the world, we still have our favorable condition for fundraising this year. And we should be able to optimize our cost of debt further. So on that note, as far as the cost of debt for the company, 2025 was 4.63. So because of the lower cost of borrowing that we have raised over the last three months or so, that's gone down slightly to 4.62. This is, of course, despite the fact that, of course, 95% of our debt are actually fixed rate. So for us, you will see much higher, improved, higher level of gearing this year. But these are all funding required to execute our capital for growth. either RAB or the non-regulated business on the generation side. So if we dive in further into our CAPEX program for the year, yes, as far as the group is concerned, regulated is 2.5 billion, but there is also 0.8 billion that we have already deployed for our non-regulated CAPEX, giving us a total of 3.3 billion. For regulated CAPEX, yes, that's actually spread out across the normal three pillars. A lot of it is going to security of supply. Demand growth as well, actually, same amount, with a little bit more going to energy transition. So yes, even in the last quarters, we talked about the split between base and contingent CAPEX. But I think as we guided earlier, for us now, it doesn't really matter anymore whether it's base or contingent, because both carry the same impact on the P&L. as far as the recognition of the income where the base tariff is recovered, base capex is recovered through the base tariff and the contingent capex will be recovered either through QE or through RP5 in the future but with time value of money. So we should be indifferent in that sense. So if you talk about what we have done this year, obviously we are optimising the reliability of the system. So some of the projects that we have delivered in the first quarter include the PMU 500 KV Sardinat West, which is around 29% completed already. That's key to deliver some of the supply to our data center. For ECRL feeder station, 10 of them, we are already on testing stage. Smart meter, which is a key component of us to enable TOU for all the consumers. That is continued to progress quite healthily. We installed close to 200,000 already this year. A target close to 1 million for the full year. That brings up the total cumulative today of already 5.8 million of smart meters enabled consumers. That's more than half of our consumer base today. So that's what Sam talked about just now about our very good system minutes as well as SID minutes that continue to be enabled by continuous investment into distribution automation, which is key to us to enable continuous uninterrupted supply to the consumers. So that's already been deployed in 800 substations today, this year, and cumulatively we have installed to more than 39,000 of our substations nationwide. So that's obviously unregulated CAPEX which continue to be on track as per our earlier guidance last year that we spent 12 billion CAPEX in regulated CAPEX for 2025 and we guided for 12 to 13 billion numbers for 2026 So we are on track to deliver that For non-regulated CAPEX this is two main projects that we are currently doing Nigeri project which is as of March already 73% completed and is on track to COD by second quarter next year. And the other one, Sungai Perak Hydro Life Extension Project, where key refurbishment and enhancement activities are ongoing. And we expect the first unit at Cenderung to start operating by fourth quarter this year. So that is a three, four year program where we are progressively refurbishment and replacing the units across Sungai Perak and they will progressively coming into operation over the next 3-4 years under a new PPA. So overall, I think this is a reflection of the fact that yes, last year we scaled up our CAPEX from 2024 regulated 9 billion to 12 billion and we continue to deliver on that momentum. So yes, there is a much stricter So ladies and gentlemen,

So ladies and gentlemen, moving forward, we remain highly encouraged by the positive demand outlook and will continue to execute our strategic priorities with absolute discipline and focus. We have revised our electricity demand growth projection upward between 4.5% to 5.5% in line with Malaysia's projected GDP growth of between 4% to 5%. In tandem with this growth trajectory, we are maintaining our group capacity of around 18 billion for the year, with approximately 18 billion allocated to the regulated business and 5 billion to the non-regulated business. These investments remain aligned with the national priorities to strengthen trade resilience, support rising electricity demand, and accelerate Malaysia's energy transition agenda. As we continue to expand and modernize our infrastructure, our focus remains on delivering projects that create long-term value and sustainable returns. We will continue to uphold prudent capital management and optimize our capital structure through disciplined funding strategies. To our shareholders, we remain committed in honoring our dividend policy while remaining steadfast in delivering long-term shareholder value aligned with the group's performance and financial position. Ultimately, our priority is to ensure sustainable business growth while supporting Malaysia's NETR aspiration and strengthening TNB's position as a leading provider of sustainable energy solutions. And also pleased to share that we have published TNB's sustainability statement within the integrated annual report agenda 5, highlighting the group's continued progress, commitments, and achievements across our ESG agenda. With that, I will conclude my presentation. Thank you for your attention. So, Azim, I'll pass it back to you.

Thank you, Dr. Shamsul and Mr. Badrul for your presentations. And just want to inform that we have 87 WebEx participants in our WebEx. And now, let us now move to the Q&A session. We will begin by taking questions from the attendees here in the room, followed by those joining us on WebEx. With that, I open the floor for questions. Please feel free to raise your hand. and our staff will pass the microphone to you so you can ask your questions. Kylie, introduce yourself and share your questions.

This is Dharami from CGS. I have two questions. First, on the Genco business, it was a very good set of numbers. Congratulations on that. Could you please... helped articulate as to what drove that significant improvement. I do notice your efficiencies have improved in terms of operational numbers, but is this sustainable going forward? Secondly, on your fuel margins, it was negative this quarter, which seemed a little odd. Could you help us understand, considering we're in a rising coal price environment? And just one more question on... Janco's numbers looking really good.

Availability of 91%, this is in what effect quite excellent. I'm coming from the background of been running a coal plant with a 91% numbers. I'm truly happy to see that numbers. This is mainly driven by the excellence O&M process that we have put in place. You look at, you know, currently we are embarking on the quadrillion base monitoring. Initiative that, you know, monitors the whole plant integrity and reliability. We look at also, you know, the continuous maintenance project and programs that we are doing and we are looking also in terms of efficiency improvements. We are also looking at how do we make our plant more reliable and also more efficient and that gives us a good number. This is on top of that that you see the high number is actually also help during the session where we lost quite a number of big units in the system and this is where we actually push all our operating generation fleet to fully maximum load to enable them to actually provide the required power during the The unavailability of some of the big gold plants in the system So in the fuel margin negative So ACP is actually fuel margin negative You want to take that?

I think we just need to take a step back and figure out actually the war started actually as of 1st March so January and February actually was lower cold prices so that means so obviously we have the weighted average of all our stocks so during that period we had the negative margin in January and February but that kind of stabilized or starting to reverse in March so at the rate that things are based on current rising prices We think that the overall by towards the end of the year, that should reverse to a positive fuel margin. So this is just purely a reflection of the first January and February low coal price. And you would recall that even in that January, February, that's why we had a rebate of the alpha. So that shows how low was the coal prices then. So that's why we had a negative fuel margin. But with now May, you have started to feel I'm sure all of you are the top 20 which is not protected by the AFA. So 8.5 million of the consumers are protected by AFA. But beyond that, you still feel the surcharge of AFA. So that's already reflected that the rising cold price and the fuel margin would eventually turn positive this year.

Yeah, with regards to Dasan Center, utilization is increasing based on the ESA sign. We are seeing that, you can see at the, in terms of utilization, we have increased from 2095 around 710 megawatt, whereas the declared demand is 1,464. And comes to March, We see the load utilization is at 1054 MW as compared to the declared demand of 1840, which is 58% load against demand. So we are tracking it very closely and we believe that the data center load will pick up as planned. The likelihood is that you're going to get more aggressive this year and also next year. And there are plenty of applications actually coming in now. We had a discussion with Muti recently where the possible of approval of another 16 data centers of hyperscaler scales that is coming into the system. So the data centers business does provide a good opportunity for us in terms of electricity growth.

Hi, I have two questions related to Genco. Number one, is it fair to annualize first quarter performance into the full year? Number two, in terms of stock currently that you guys have and also discussions with suppliers, particularly from Indonesia, how does it look like, especially there's potential export ban and Indonesian suppliers or the government making it hard to export coal? So I appreciate you can get some more clarity.

I had a discussion expecting a question from you today. It's not very good today. It's Indonesia's potential export. Let me answer the number one question first. Is it fair to analyze Q1 results? In my honest opinion of running a power plant for the last 33 years, you know, anything can happen moving forward for the next quarter, but we will try our best. But once we record such a high performance during the first quarter, what the stations will actually do is actually maintaining that number. There'll be hiccups here and there, there'll be issues here and there, but basically the stations, the operations people knows what actions need to be taken in order for them to maintain that. They are trying to maintain for Copeland a figure of less than 6% on time of this rate and also 4% for the gas turbines and combined cycle. I hope for the best, but certainly we'll try hard to actually maintain that sort of performance until the end of the year. So in terms of the coal supply potential export ban, Recently, Indonesian government has come up with what they call it managing the export expectations of the Indonesian government. What they do is actually now they are trying to consolidate the whole supply management into one entity that exports Indonesian coal to the rest of the world. So basically, you've got multiple coal suppliers that deal with one National Entity, they call it BUNM, you know, and then this BUNM will deal with the rest of the obstacle of this. We have yet to receive a clear guidelines and policies and produce how they could implement it. So I've asked the team to actually go out and engage with the Indonesian governments, ESDM, Minerva, and the Indonesian authorities What will be their concrete procedures and plan in order for them to manage and handle this moving forward? In terms of coal supply to Malaysia, shouldn't be worried because we have a long-term contract with all our coal suppliers. They remain committed and adhere to whatever the contractual obligations that they have currently. So rest assured, no problem. I don't think they'll pull the similar stunt like they did in January 2022. They'll put a stop on cold embargo during that period. It's just a matter of... what we call it administrative procedure that they have to in order for them to protect the coal revenue that actually each coal producer is producing in Malaysia what they do is actually some coal producers are actually not declaring what they have invoiced and different so they lost a bit of collections so they are trying to streamline and manage that process but rest assured no export ban foreseen for the coming year or next few years, inshallah. Alright, thank you.

Hi, Hazmi from CLSE. I have a couple of questions, but I'll start with three first, just to piggyback some of the earlier questions. On Janco so far for second quarter, are you seeing the similar kind of performance as first quarter? And historically, have you seen, when was the last time you've seen this kind of very good performance? um secondly on the Iran war um sort of challenges um any sort of like pressures from from the war um that you guys are seeing that worth highlighting um and also especially in terms of like you're deploying more and more of like capex going into this this year and next year as well any sort of issue in procuring some of the like long lead items and all that and also thirdly just can you share more colors for those data centers who cannot sort of like utilize of the committed kind of utilization that they have sort of like agreement for what kind of like penalty and all that that you guys have discussed with them thank you me come on be ready to pick up first anniversary okay

We got Datuk Kamar, Chief Retail Officer here to pick up data center's questions here. So in terms of performance, second quarter, Datuk, sorry, but I'm seeing a good performance from the Janko fleet. I have not received any major breakdown to date. And moving forward, there will be a couple of what they call a schedule maintenance being planned. but surprises I have not seen and I really hope and pray hard that no surprises will come in for the next year so we are expecting good numbers also for Janko and you know taking into consideration Janko's last year performance I think this year inshallah will be a good performance for Janko we really hope that On top of that, we are now carrying out quite a number of upgrading and refurbishment work on the all aging gencos such as the life accession plant on the hydros, Sungai Perak, all those things. And we carry out quite a number of major overhauls actually on all our units in the core plant. I'm hoping that initiative will actually best good results in the few coming months. Regarding the Iran-Muad challenges, today what we have seen is actually the increase in terms of the gas price. That is the first impact that we've seen. But in terms of the supply, I think we have enough. Because we are a very blessed country, we've got indigenous gas coming to all our plants from the Keteh, Penyufil. We still require to import LNG, a few vessels of LNG. But almost 800, close to 800 million scarf is actually, close to 1,000 million scarf is actually coming from our indigenous guests. So we are quite protected. It's a subsidized price. In terms of coal, we are quite secure. No problem. In terms of our supply chain management, we don't see any impact of the Iran war towards all the Supply Chain Management So right now we do have some strategic subsidiaries that provide such as cables, switch gears and also some of the electrical equipment required for our development of our distribution and also transmission So more or less what we have scanned around is actually quite covered in terms of the supply chain and the impact of the Iran war does not impact us directly On third question, may I invite Datuk Kamal to provide some insight on the DPH?

Thank you, Datuk. Basically, we are seeing a very positive trend with regards to data center. As you know, data center, the way that they plan their loading is on the step load, right? So normally we see that on the first year, the load is not as per what they are supposed to need. But we have all covered under our ESA, our Electricity Supply Agreement, where we cover whatever declared load that they have not met, there is certain penalties that they have to pay. And you see the new trend, the recent trend of data centers who are already in their second or third year, this is where they ramp up their load. And most of them meet the minimum 75% or 85% declared load, and some even surpass their declared load. So that's why you see from last year, we are talking about year-on-year growth. For data centers, that's about 12% growth as against the year before. We are all covered and we are looking at there being a very good day master so far as far as our collection we have no issues with the data center and we see that the trend is a positive trend from them and the new demand that is going to meet keeps on coming in meaning that we are not looking at them stopping coming into the country but of course there is going to be more what you call this coordination with MITI and ST and MAIDA to make sure that we contain in terms of the growth as per what we want to meet their demand so we are looking at a positive trend of data center thank you

Thank you. Just follow up with the last three questions. I think this is the first one following up on the, you mentioned 16 hyperscalers data centers are under application. Can you roughly share where is the location, roughly? Secondly, in terms of the contingent CAPEX timeline for approval, how long does it take, if you can give a general sense? And last but not least, just a general comment based on the electricity demand growth that you're seeing right now. How do you see the RP5 capex will pan out? Just in general comment, thanks.

Okay, as you know, data centers, they will try to locate themselves close to the point of interconnection with regards to fiber. as well as water and electricity so those places that we know in Sabah Jaya recently we are looking them looking into Nilai which is a new place and of course data centers their motivation is to look at how do they get a lower land cost and definitely that's one of the motivation factors for those So currently we are looking at still the concentration is on the west coast of Malaysia and of course we are looking at some trends that we are now promoting more on the east coast where we are looking around Kuantan or even Kuala Tengganu where they do not really need the latency issue there, which we are quite positive that those are the new location of mostly AI data centers, right? And the one that is the hyperscalers, more on the west coast of Malaysia, where we're looking at the normal place, Cyberjaya, Maranti Park, Nilai, Nasional Berhad Nasional Berhad Nasional Berhad

So obviously the first priority for us as far as the regulators are concerned is to utilize the base CAPEX and some of the contingent CAPEX project where possible they also would like us to re-prioritize that into the base CAPEX but when it is clear that it has to be under contingent CAPEX then we need to get the approval to make sure that we will be able to recognize that income So the timeline really differs according to the type of deployment. I mean, I can tell you, for example, the smart meter AMI with TOU being a key enabler for RP4 for everything, that is a high priority project. So when we submit that, we get that approval very quickly because it's very clear that it has to be deployed. Government wants that to be deployed. So very fast approval. There are some other projects that helps to strengthen our operation such as the distribution automation that I mentioned just now so the scale and location of the deployment matters so we have to justify where it is being deployed and why it has to be deployed in that location and how it helps the overall delivery of our PsyD under the KPIs so it really differs according to project But I think if anything, what I would like to comfort you is the fact that the contingent CAPEX approved, contingent CAPEX that we expect to implement this year, almost 75% of them has already been approved by now. So it's just a matter of delivery during the year. But of course, 25% still need to be approved. And that's the challenge in the sense that it's already made. I need to get approval and after the approval, we need to get it delivered so that we can recognize the income during the year. So that's why we believe it should be on track. We're working very hard to deliver those expectations. So the process is different, but we are on track with our guidance for this year.

So in regards to RTE5, you're really well ahead of time, Malawi. While we are still struggling to form up the proposal, you already asking how the CAPEX will be filed. So we are in the process of actually redefining and collecting all the information required to make the necessary proposal. But looking ahead at the demands, which is increasing, we probably need, I can't say what is the actual amount, but a considerable amount of CAPEX needs to be spent. probably is not as big as the RP4 CAPEX because they have actually allowed us to gain a lot of many projects to be executed in the RP4 program. But still it will increase in terms of the system reliability, systems taking into account the availability of the tariff later on. But in terms of the tariff, the tariff is always, in terms of the network charges, is always, I would say, 30% of the total tariff structure so 60% is always coming from fuel what we are hoping actually we like to propose is in managing a very affordable and sustainable tariff while meeting the systems reliability and and and also strengthening the system moving forward because we see a lot of demand and disease coming into the system. On top of that, we are also looking at how do we strengthen the grid system because we probably see a lot more RE penetration into the whole system that requires a lot more grid flexibility in managing intermittent system issue. So we are looking at many more batteries BSS projects coming into the future That's where we also get excited about the prospect of a new sector in terms of energy that we can actually play in the energy ecosystem. Thank you for the question.

The tax for this quarter is relatively high. The guidance for the full year, is it still maintained at below 25%?

Yes, Daniel. Under long-term guidance this year, we should land full year at around 24%. It's still intact. yes I know this quarter we are at 30% but you should look at that against last year when we were 33% so it's already better but we did a bit of capital allowance claim has been a bit slow this year for the first quarter and as far as the incentive is concerned the claiming process actually requires a bit more fine tuning so we just want to make sure that the earnings and the calculations are proper so that we should be able to get what is entitled to us So in the first quarter, we are being a bit more prudent on the part of the incentive being claimed. But like I said, full year, tax is obviously once a year affair. So by year end, we do expect us to hit the 24% as guided earlier.

Second thing is on the CapEx, regular CapEx 2.5 billion. May I know the breakdown between the contingent and base CapEx?

The $2.5 billion are all regulated CAPEX, yes. The contingent CAPEX is relatively small for the first quarter at only around $200 million plus. But this is expected because, like I said, the priority is to deploy the base CAPEX. So the contingent CAPEX is much smaller and will be deployed later. But this is the part that, like I said, for us, it doesn't matter anymore the difference. As long as the full year we deliver the 13 billion capex, we would get the earnings benefit out of that amount.

Last year, 2035, you guys spent 1.7 billion on the contingent capex. So by right this quarter, you guys have already start to recognize the allowable return on this 1.7 billion capex already. Is it in your account?

Contingent capex? The financing benefit actually comes in, yes. but it comes progressively during the year.

So this quarter you spent $200 million, does that mean that next quarter you will start to recognize the $200 million allowable return as well? Yes. So you only start to recognize it when you already spent on the FedEx? Correct. So you recognize every quarter basis?

Yes.

Okay, thank you very much.

That's all from me. Hello, this is Colin from Macquarie. Just two questions following back on the DC team. So you're saying that on a METI level, there's still a lot of DC applications coming through. I was thinking from like a supply perspective, like how do you look at the ESAs? Are there still room on that front, keeping in mind on your reserve margin? And then on the other question, also on DC, if there's not enough supply to give out, considering there's a lot of applications, could you potentially look at some of the fine ESAs you have? ask these off-takers to potentially release some of it of the unused capacity sign. Thank you.

Of course, in terms of planning for DC, we have this which is chaired by the Menterie on that with regards to the demand of DC. Certainly, we pace the demand of DC based on what they declare on year basis. Question number two, whether The way that this you know there are two types of data centers in terms of high-stakes data the one that is co-located the one that will find tenants and as far as we are concerned as long as they meet what they declare then we are happy to work with them so Long-term, with regards to the demand, we are seeing a lot, as Datuk Siwo mentioned, there's about 16 new data centers already sent in their application to MITI. And certainly we are working with MITI to see how we meet their demand. And certainly we are also pushing them towards the RE, basically CRESS, as you know. We have one data center already signed about one gig in terms of RE requirement under CRESS. and we are confident that more will come in and of course with the AFA in play and all that that will be more attractive for them to come in and sign that and also we are talking to community with regards to how the new data centre will have to meet up with the requirement of RE as well as being more what you call this more efficient So these are all the mitigation action that we are talking to MITI to ensure that we do not stifle the growth, but at the same time, we are encouraging more benefit that the country can get from the influx of the data center. Thank you.

Maybe we can move to take questions.

Sorry.

Hi, good morning. Sorry, this is Isaac from . Just two questions for me, please. Number one is in terms of the country generation mix, I think we are transitioning to more gas and less coal in the years ahead, and you are building some new gas plants. So what is the strategy in terms of the procurement of this gas, and is there any room that Tenaga as a group can play when the country demands more maybe imported gas? Is there any business opportunity that you see and you can do? That's number one. Number two is a quick one, it's on the solar, I mean your RE plans. With the solar panel prices going up and the cost is on the higher, how is it affecting the profitability of your current RE project and how should we think about the rates for the future solar facility in Malaysia? Thank you.

So I think the number one question with regards to the generation matrix Just in line with our energy transition, we are not building any more coal plants, but we are building quite a number of gas plants, especially high efficiency combined cycle gas plants. So opportunity, yes, there is a play where we can actually enter into the gas supply market that we are positioning it well. We are working with our counterparts, you know, we're looking at opportunities, how this actually we can play in that gas ecosystem, energy ecosystem. We are looking at the RBT, we are looking at the importing gas also, we are positioning ourselves well. Unfortunately, we have not made any announcement on that, but it should come very soon. How do we position ourselves as players to the gas market and also an importer of natural gas in the future. That will definitely come.

As a country, would you be looking at a national gas aggregator or some similar entity to help with the future?

Yes, they have that idea of having a national aggregator. in play and they have identified us in Nasional Berhad to become a preferred aggregator for the country since we are the biggest off-taker of gas because of our generation portfolio so there is a serious discussion ongoing with regards in Petrajaya and on SP how do we possession tenaga as the key because of the experience and the leveraging on the off-taker strength that we have currently right now So, Pona, how solar panel is getting more solar panel is affecting how the rates and profit to be in the future. I know solar sector profit is becoming very competitive nowadays. But we will play in that market. We got Janko, we got TRE, we got G-Sparks also on the road to solar sector. Can you just tell us how many months of co-inventory do you have at TMB for you?

Question number two, if you look at the website, in terms of your forecasted AFA for August, you see that the surcharge will actually exceed about $0.03 Can I understand that for capital approval for you to exceed $0.03 do you need to get approval in the month of July for the actual surcharge or at this point of time of forecast and given that assuming the ECs I believe the high case scenario if the things continue to escalate and we're going to see high surcharges do you think there will be a risk to your demand for electricity given that the government has also mentioned that this sort of energy inflation risk as well.

So, Isaac. Isaac, alright. Thanks. Okay, coal inventory, we are hovering between 20 to 30 days. That's our standard inventory levels that all the power stations have to store at any particular power station. That should last for 30 days in the consumption. So, usually you see that is hovering between 20 to 30 days, depending on the consumption position. When AFA exceeds $0.03, we are seeing that now, the previous one is actually between July last year until April, we are seeing the AFA is only on the rebate region. But now, moving forward, we are seeing a little bit more on the surcharge side. So according to the cabinet paper, anything that is above 10% from the normal tariff, you go and ask the approval from the cabinet. That is the instruction given to us. So for now, we are not seeing that happening, but anytime it's going above 10% of the stipulated tariff, we have to get to see an approval from the cabinet. So whenever you see approximately fluctuating between 3 cents and minus 3 cents, no approval is just a simple pass-through to all the consumers. That will happen. So, when it comes to why is it on the high side, it's mainly driven by the high LNG prices that we are importing right now. In terms of debt structure, whenever we consume 1,000 in terms of the LNG that we import is actually all associated with the brand index. So now the brand is actually at close to 100 barrel, 100 USD per barrel. So right now the gas price is not associated with brand, the 15% on top of the tier 2 gas price is all associated to the brand price. So we are seeing that little bit of the high side on the gas emission, but we are still, whenever there is a pressure to actually import gas, we have requested Petronas actually to pump in more indigenous gas to the energy sector. So that should be able to mitigate the prices moving forward. So high success, okay. I guess that should answer your question. The last one, what is the question? Okay. If there is too much surcharge, there is an impact of the demand? I don't think so, but there's certainly a lot of complaints from the netizens coming up. I've been monitoring the netizens' Facebook and Instagram, and they even got a specific group. Please share, I don't know, Facebook, what is it? There's a specific group, you know, about 50,000 followers in there, you know. Maybe we can move to Webex

So we have question coming from Nur Iwani Farzana from PNB. Nur Iwani, we have unmuted you.

Can you hear me?

Yes, we can hear you.

Okay, thank you very much. I have a few questions, but first a follow-up to Mike's question on AFA representing netizens. On this, Dato, I think what we want to understand, maybe if you can share when it comes to the AFA trajectory, right? I understand right now we don't see the need for the surcharge to be beyond 3 cents, but can we understand when it comes to the KWIE fund, when it comes to subsidizing the 3 cents, what's the trigger for the fund to actually tap and subsidize even if it's is still below $0.03. So just try to understand this structure. And I think secondly, when it comes to, this is the second question separate from the ESA. So when it comes to the gas and diesel mix generally, so we understand that there have been some concern when it comes to gas supply. But moving forward, we also want to roll out more CCGT and the backup fuel is diesel. So understanding this currently, have we seen any change in terms of increasing some diesel mix in certain power plants? And are we seeing this trajectory to be there in the next few months, for instance? And how does this translate to your forecast when it comes to EFE? So that's one. And the second part of this gas and diesel mix for CCGT power plant is that Moving forward, do we see a slowing down, not a slowing down, but in terms of capacity downsizing for the upcoming CCGT Power Plant Award, as well as coal extension due to these gas and diesel shortages, as both fuel are also in the current bottlenecks. The third question, sorry, I'm just going to lump all questions and make sure I write it on chat so that you can refer to it afterwards. So I think the third question is also on DCs, a follow-up to the rest of the questions. I think for DCs, three parts of the question. Number one is we are trying to understand for the current framework of the penalty, if you may share, was the framework something that was recently established and do we see two do we see frequent moving forward frequent revision when it comes to this penalty to ensure if DCs are still not complying are we going to are we going to be more are we going to be stricter when it comes to the penalty structure secondly for the DC question is that for the upcoming RE mix you mentioned that we want DC to be able to have some RE mix in their power mix but is there a certain percentage as a direction and if not this leads me to my third question because there have been a lot of debate when it comes to depending on RE for disease for the SAC charges and I think right now they are still discussing about four options for SAC revision and one of the issues that if you want to say fix the price or if you want to a certain future SAC charges. We kind of need to know RP5, RP6, RP7, up until RP7 investment kind of base because we want to know for the next 10 to 15 years what's going to be the appropriate SAC charges. So on this note, have Petra or ECA in conversation talk to you about kind of trying to forecast the upcoming RP5, RP6, RP7, although I understand you mentioned RP5 is still early, but it seems like this mechanism is requiring us to actually see what's going to be the future charges. I think I'm going to stop there. That will be my question.

Well done, Irwani. So, AFA trajectory whenever it exceeds $0.03 and when the QE fund will kick in, it is under the purview and jurisdiction of ST. So, we do notice that whenever they see actually a surcharge on the high side, ST with the concurrence of PESA do come in and actually kick Kuipan to actually absorb certain portion of the surcharge. That I can guarantee. Alright. So what will be the fundamentals of them utilizing the Kuipan? The Kuipan that is under this discretion. I cannot comment on that one. In terms of question number two, in terms of Indonesian coal supply, right now we do not foresee any disruptions in terms of logistic supply chain. That is clear because 70% of our portfolio of coal is coming from Indonesia and it's quite close. Indonesia is quite close to Malaysia. So the vessel can come in within a span of four, five days actually and the vessel can reach Malaysia. And most of our vessels are actually Malaysian flag vessels. So we don't foresee any issue in terms of logistics when it comes to exporting coal. coal between Indonesia to Malaysia. We also import coal from Australia. That is coming from Australia. Also, we will not be distracted by the current geopolitical issue in Middle East. So, number two, I'm rest assured we are covered in that area. On the gas and diesel mix for CCGT plant, in our opinion, diesel is a big no-no to us because it's very expensive. So, we always focus on gas High-efficient gas turbine combined cycle units that we want to plan up future in order for us to maintain the generation cost in our energy system. In terms of energy, we do use diesel for our diesel generators, but that is going to be very minimal in nature. Penalty and Penalty on DC Mechanism What was the last question? Oh the SAC Chargers I think that is a deliberation and also very detailed discussion going on between SAC Petra and some of the local players what is the right SAC Chargers to be charged to the players I guess let them be right now the SAC Chargers will be decided And certainly it's going to benefit not only the industry, also the players. It's currently being deliberated on. They had a discussion yesterday. They had an engagement, I believe, yesterday with regards to the SEC charges. And for now, I may not be able to comment more than what I've said just now. Okay, the new Gen 26, actually, that one is actually in progress. They are now requesting for request of proposal. And hopefully, we'll be, inshallah, we'll be participating in the next new Gen 26 also tender. Okay? Thank you.

So, we have another question from Fung from CIMB. So, I reread the question. Noted that the guidance on regulated CAPEX remains the same. just wanted to understand why 1Q26 regulated capex was lower year on year and the second question is if there are any delays to getting approval for the remaining 25% contingent capex any risk you see that regulated capex could fall short of 13 billion guidance for this year or you can bring forward this capex to still meet the guidance

So, yes, if you look at our capex deployed for first quarter 26 at $2.7 billion, it's slightly lower than last year's $2.7 billion. That's obviously, among others, because of the holidays that came in during the first quarter this year. But really, to us, the difference is minimal. so that is really a matter of getting the recognition of the work in progress into our asset register and getting it really registered as regulated asset base so for us there's nothing to worry in terms of the quarter and quarter difference this year and last year just matter of documentation and process so as far as the remaining approval that we require for contingent CAPEX this year Well, of course, we cannot say for certain that everything will be approved, but we are quite confident that the business case to get there is there. So if you talk about the downside risk of the CapEx this year, I think we are quite sure that as far as the guidance, we committed $13 billion. But I think, yes, if you're talking about a range, I think last year was $12 billion. This year, definitely, we believe we should hit at least $12. That's why we're pushing for $13 billion. But that's based on the progress and the approval. So I think if you want to be more conservative, then it's the same $12 billion, but we're pushing towards the $13 billion regulated CAPEX. But on $1 billion different regulated CAPEX, obviously the earnings impact would have to be counted in that as well. But to us, it will not be lower than the $12 billion that we delivered last year.

Alright, so I think we have one more last question from Webex from Mayang, Morgan Stanley. Hi Mayang, can you hear us? Yep, I can hear you.

Okay, so firstly, thank you for doing this presentation. I think the first question I had was in terms of rooftop solar, what percentage of the grid supply right now comes from rooftop solar and how much has been the change in the the supply curve as you have seen more rooftop solar come through so basically what I'm asking is average 4 hours over average 4 hours in terms of the spread have that widened in terms of the variability and how much is that if you can kind of give us some sense of what's going on there around grid stability and the second question was more related to T&D tariff how much have you seen the increase in T&D tariff that you have booked for this quarter versus last quarter and if you can give us a guidance of how much will it increase for 2026 over 2025 in absolute T&D tariff.

Thank you. I think Mayang was asking about how much Megawatt actually hook up to the Roof Solar as compared to how much solar hook up to the grid. Can I confirm that, Mayank?

So I was asking in terms of the actual supply, in terms of how much units of rooftop solar are now contributing in terms of supply to the grid.

Mayank, on any normal particular day like today, when we have a maximum demand of around 21 gigawatts, usually for the period of 4 hours between 11 to 3 o'clock we have around 3.6 gigawatt of solar out of which roughly 1 gigawatt is actually at the grid level that would be the LSS supply connected directly to the grid and around 2.5 gigawatt are actually what we call distribution level rooftop both at the lower voltage as well as what is under Normal Commercial and Residential Rooftop Solar. So if you put it into perspective, roughly around 3.5 to 2.5 at distribution like there's a comment. At fuel mix level, yes. So around 2.5 gigawatt will be out of the 21 gigawatt that we are supplying today. Yep. I'm not sure exactly what you are talking about for the TNB tariff for 2026 because you know that the approved base tariff is 45.4 and out of which roughly 11.2 is network tariff so what we have recorded is actually around 45.7 so the The TND tariff actually does not move much compared to what is approved.

Sorry, I was not unmuted. So the reason for the network tariff was because obviously you are spending more now on that kind of putting the contingent topics into the numbers as well. So technically, your network tariff has to be higher this year versus last year, whether it is 2 cents higher or 3 cents higher. I don't know that number, so I was trying to understand where does that fit. And I think on the rooftops of that as well, the 2.5 gigawatt that you kind of said, is that actual supply to the grid or that is the capacity connected to the grid?

Actual supply to the grid.

Sorry, that's clear.

Okay. Okay. On the network tariff just now, Mayang, yes, this is the part when we, in the last quarter, we talked about the earnings recognition of the contingent CAPEX, that the earnings recognition is similar to the base CAPEX. However, we have made it clear that the contingent CAPEX has not been decided by the government in terms of actual recovery of the cash. So there is two possibilities, government allowing us to pass that to the tariff, or government paying us the difference through QE or government bundles that into the next RP5 tariff. If it's bundled into RP5 tariff, it will come with time value of money. But of course, we would rather government pay us now through QE fund if it's not being passed to the consumer. So at the moment, contingent capex is not translated into the tariff increase yet.

Ladies and gentlemen, due to the time constraints, there is all time that we have for the Q&A. I would like to thank you for your questions. Now, I will pass to Dr. Shamsul for his closing remarks.

Thank you very much for all the forward-looking questions. As always, please reach out if you have any questions regarding the So, to summarize today's session, our first quarter performance reflects continued resilience and core strength of the MBC business and the regulated portfolio continues to serve the MBC business. as our primary earnings anchor, providing strong stability and cash flow visibility, complemented by our disciplined RP4 execution and robust operational performance. We continue to advance our strategic priorities, including strengthening grid resilience, accelerating renewable energy integration, and supporting rising electricity demand, driven by commercial and data center segments. At the same time, we recorded healthy electricity demand growth, achieved an MSCI ESG rating upgrade to

for the second consecutive year and continue to strengthen our sustainability agenda and operational execution capabilities.

We remain committed to delivering sustainable returns to our shareholders. Our dividend policy remains intact and we expect to sustain the current trend of dividend payments subject to the group's performance and financial position and supported by continued demand momentum, disciplined capex execution and prudent capital management We remain confident in our ability to deliver sustainable long-term growth moving forward. And looking ahead, our strategic focus remains firmly anchored on driving Malaysia's energy transition while delivering long-term value for our shareholders. Thank you very much, ladies and gentlemen. And that concludes today's session. And I would like to take this opportunity to wish everybody the blessed Adaha to all who are celebrating and may this occasion bring joy, peace and blessings to you and your loved ones. and have a pleasant day again. Assalamualaikum warahmatullahi wabarakatuh.

Thank you, Datuk Shamsul. Ladies and gentlemen, we have now come to the end of our session. On behalf of Tenaga Nasional Berhad, we thank you for your participation in today's briefing. For any questions that remain unanswered, rest assured that we will promptly address them following this event. If you require further clarification or inquiries, feel free to contact our Investor Relations Officers or email us at tenaga-ird at tnb.com.my. To all our attendees, whether present physically or virtually, we appreciate your time and engagement. For those here in person, please join us for a networking refreshment available in the lounge area at the back. Thank you once again, and we look forward to seeing you in our future sessions. Take care and have a wonderful day.