PENANG, 26/6/2014: PBA HOLDINGS BHD (Stock reference: PBA – 5041) has reported an operational profit for the 12th consecutive year and is awaiting approval for a proposed water tariff review in Penang.
Today, the company’s annual general meeting approved a final single-tier dividend of 4%, rounding up the total dividend pay out to 7.5% for the year.
In 2013, the key performance indicators (KPIs) of its 100% owned subsidiary, Perbadanan Bekalan Air Pulau Pinang Sdn Bhd (PBAPP), were well above average compared to national statistics reported in the Malaysia Water Industry Guide 2013:
(1)Supply Coverage: PBAPP’s percentage of urban population served is 100% as compared to the national average of 96.9%. Meanwhile, the percentage of rural population served in Penang was 99.7% as compared to the national average of 90.7%.
(2)Operational Efficiency: PBAPP’s average number of connections per employee is 451, or 27% above the national average of 354.
(3)Water Loss Management: Penang’s NRW percentage in 2013 was 18.2%, or half the national average of 36.4%.
(4)Tariff Ranking: PBAPP’s average domestic tariff for the first 35,000 litres per month was RM0.31, the lowest in the country. Moreover, its average trade tariff for the first 500,000 litres per month was RM1.19, as compared to the national average of RM1.45.
(5)Profitability: PBAHB tabled a profit after tax of RM27.93 million in 2013. Meanwhile, Malaysia’s total national deficit, or loss, from water operations was RM380 million in 2012.
Accordingly, on 21st November 2013, PBAPP received the inaugural ‘Water Supply Operator of the Year’ award as well as the ‘Efficiency Award’ from the Ministry of Energy, Green Technology and Water, or KeTTHA.
Meanwhile, PBAPP is awaiting approval from the National Water Services Commission (SPAN) for a review proposal submitted on 30th April 2014.
PBAHB Chairman Y.A.B. Tuan Lim Guan Eng who also serves as Chief Minister of Penang, reiterated that the primary objective of the review was to avoid water rationing at all costs. The review, he said, was a demand management initiative that would help by cutting down water consumption and wastage of excessive water resources caused by low water tariffs that resulted in Penang recording the highest water consumption in Malaysia. It would also assist the Penang State Government to secure the Federal Government’s approval for the commencement of the Sungai Perak Raw Water Transfer Scheme that will guarantee water sufficiency for Penang until 2050 by showing that Penang State Government is serious about taking concrete steps to reduce the highest water consumption in Malaysia.
“This is the first increase in domestic water tariff since 1993. The minimum charge for domestic water supply and the tariffs for consumption of up to 40 cu.m. was last reviewed in 1993. Domestic tariffs for consumption of more than 40 cu.m. per month was last reviewed in 2001. We do not wish to speculate on the amount of additional revenue because we are still awaiting official word from SPAN. Moreover, this amount will be subject to the date of implementation and customer response,” he added.
Y.A.B. Lim, who also serves as Chief Minister of Penang, said the additional revenue from the proposed tariff review would be used to finance critical water supply infrastructure projects, as well as a water-saving culture and sustainable water supply management in Penang.
“In 2013, we saw a 1.5% increase in registered water consumption in Penang year-on-year, from 290.6 billion litres in 2012 to 295.1 billion litres in 2013,” he said.
“Domestic consumption accounted for 59.5% of total consumption, with the remaining 40.5% being trade consumption. It should be noted that Penang’s average per capita consumption was 311 litres per capita per day (l/c/d) in March 2014, during the height of the ‘water rationing’ season, as compared to the national average of 212 l/c/d,” he said.
“With PBAPP’s good supply management, we managed to avoid water rationing in Penang from January to April 2014. Nevertheless, forced rationing in Kuala Lumpur, Putrajaya and Selangor, as well as in districts within Perak, Negeri Sembilan and Johor, have reinforced the need and urgency to reduce domestic water wastage in Penang so as to mitigate future risks,” he added.
Based on PBAPP’s business model, domestic consumption for up to 35,000 litres per month is subsidised for the benefit of households. In 2013, the total subsidy for domestic consumption amounted to RM67.5 million.
Under the tariff review proposal submitted to SPAN (please see “Appendix A”), the tariff for the first 20,000 litres of domestic consumption per month will not change, while the tariff for more than 20,000 litres – 40,000 litres have been reviewed to increase by only 9.5%. With minimal adjustments at the lowest bands of domestic consumption, Penang will still retain the lowest average tariffs at RM0.32 per 1,000 litres for the first 35,000 litres per month in Malaysia. The national average is RM0.66 per 1,000 litres (please refer to “Appendix B”).
Beyond 35,000 liters per month, a RM0.48 per 1,000 litres water conservation surcharge (WCS) is applicable. However, PBAPP offers a 60% discount on the WCS to families of 8 persons or more.
Trade consumers are not subject to the WCS but will pay an average of 18.8% more per 1,000 litres. Penang’s average tariff for the first 500,000 litres of trade consumption will still be the lowest amongst industrialised states, and dips below the national average of RM1.45 per 1,000 litres. Meanwhile, the charges for temporary supply, mainly for construction applications, and shipping will be increased by 97.4% and 66.5% respectively (please refer to “Appendix C”).
Y.A.B. Lim said the 2014 tariff review was aimed at ensuring that all PBAPP customers would continue to enjoy 100% urban and 99.7% rural supply coverage in the immediate future. During the year in review, PBAPP’s customer base grew by 2.4%, from 533,916 to 546,749 registered water consumers in 2013.
“With continuing growth in our customer base, we need to cut down on domestic water wastage. This will help us to avoid water rationing and ensure sufficiency for Penang’s on-going economic growth,” Y.A.B. Lim said.
The Chief Minister pointed out that Penang was currently one of the top three tourist destinations in Malaysia as well as many investors’ location of choice.
“Penang recorded a 33.4% increase in domestic airport arrivals and an 8.2% increase in foreign arrivals for the first two months of 2014, as compared to the corresponding period last year. Penang is also the top foreign direct investment (FDI) state, accounting for RM19.7 billion in FDI, or about 20% of the total FDI recorded in Malaysia, in the period from January 2010 to August 2013,” Y.A.B. Lim said.
While supporting the continued growth of the manufacturing and tourism sectors, the State Government is also promoting the growth of the shared services sector through the development of a RM3.3 billion Business Process Outsourcing and Information Technology Outsourcing (BPO-ITO) hub that will create tens of thousands of new jobs. The hub will comprise 74 acres of an IT-BPO Park in Bayan Lepas, the planned development of 7 acres of BPO Prime Centre in Bayan Baru and 100,000 sq. ft. of Creation Animation Triggers (CAT) in the George Town heritage enclave.
“Due to good management, continuous water supply is taken for granted in Penang. However, it is a fundamental requirement for Penang’s continued well-being today, and its prospects for the future,” Y.A.B. Lim said. “As such, PBAPP will continue to manage water supply responsibly to avoid water rationing at all costs.”
—–Mandarin Version —–
槟城26日讯:槟州供水机构 (Stock reference: PBA – 5041) 连续第12年获得营运利润，目前正针对水费上调等待批准。
(2)营运效率: 槟州供水机构平均每一名雇员的联系达451人，比全国平均354人高出 27%。
Contact: Syarifah Nasywa Syed Feisal Barakbah
Corporate Communications Unit
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