Phoenix Power Company SAOG (PHPC) Earnings Call Transcript & Summary

[Foreign Language] Good morning. Welcome to our MSX discussion sessions for 2024 result. We'll start with the agenda of today meetings. So this is the agenda for the today meeting or discussion. So the first point is we'll give a disclaimer. The second is introduction of whole of the business. And then we'll talk about just statistics and then move to the contractual relationship and technical highlights and then financial performance. At the end, there will be time to ask any questions and answer to that. [Operator Instructions] So as usual, we'll start with the disclaimer. As usual, we are presenting here information, but we are not intended to make an advice for an offer or any investments in our company. The financial information included in this presentation is audited financial statement and of public knowledge disclosed to the market on the MSX website. And it is for the information purpose only. So for the people who don't know Phoenix. This is overall an introduction of the company. So the company own Sur IPP power plant which is located in Sur. It is a build, own, operate scheme; gas-fired, combined-cycle power generator facility with a power purchase agreement of 15 years with the offtaker. The capacity of the power plant is 2,000 megawatts. And there is [indiscernible]. And the cost of the project was $1.6 billion. [indiscernible], as I mentioned, Phoenix Power Company; and the operator, Phoenix Operation and Maintenance Company. The company was incorporated in 2011, and commercial operations was in 2014. Well, we'll move to the HSE. So this is the message we normally -- we usually give to the -- our employee and on partners. So nothing is so urgent or important that it cannot be done safely. The company adheres to the highest standard of the quality, health and safety and environment practice in its activity, with a focus on the sustainability development and creating a safe working environment for employees. And maintaining the health and safety of customers and community is the top priority of the company. So here's the key highlights of the achievement in terms of the HSE during 2024. So we have achieved almost 2.7 million total man-hours since the commercial operations [ dates ], a total of 3,674 number of days without lost time injury since the commercial operation [ dates ] and 18.9 total number of [ manpowers ] in 2024. So the company also in a regular basis monitor and review compliance with the quality, health and safety and environment regulation across all units and departments. The next slide is -- describe the contractual relationship of the company. So we can see here we have a contract of 15 years to sell the electricity to offtaker. And also we have long-term service agreement with Siemens, the company which provide us the machines, to make sure that our machines are reliable for -- over the period of the [indiscernible]. So we have international banks that -- they have been giving us the loan for the projects. And also there is -- we have the regulator, the APSR. And also we have also the contract for supplying gas with the Integrated Gas Company also for 15 years. I'll move to the -- some technical highlights for the year. We are proud that we are the most efficient and reliable power plant in the country. Also we have the biggest independent power plant in the country. And we have contributed almost by 27% of the IMS (sic) [ MIS ] during the last year, 2024, with -- the capacity of the IMS was 7,511 megawatts. And commercially, we are -- last year, we achieved [ average ] commercial availability of 99.75%. As I mentioned, we are proud that we are the most efficient and reliable power plants. And in terms of dispatch, as I mentioned, we are contributing 27%. And in terms of the megawatts, we contribute by 10,217 gigawatts for 2024 compared to 9,535 gigawatt hours in 2023. So that is an increase in the demand, yes, and that has been reflected in our dispatch to the grid. Move to the financials performance of the year. Here is a summary of our performance of the year or 2024 compared to the previous year's. As we can see here, the net result was OMR 22.99 million compared to OMR 21.926 million in 2023. So there is increase in the net result by [ 4.89% ]. Revenue side also has been improved by 5%. Also we'll give more detail in the next slides. So if you look. The next slides give you a waterfall of how we achieve the better result in 2024 compared to 2023. So in 2023, the net result was OMR 21.926 million. And we are -- end up 2024 with OMR 22.99 million in the net result. So you can see here from this slide 358,000 came from the [indiscernible] margin, as there is a higher operating cost by 1.053 million. This is due to the scheduled maintenance outage during 2024 [indiscernible] implemented. Also general and -- G&A was in line with last year. Financing costs, there is an improvement by [ 1.969 million ]. This is because of the [ lower ] interest due to the scheduled repayment. Also the company has achieved a higher interest income last year. And also, the tax impact was [ 126,000 ]. So revenue, as I explained, was better. So this is a summary of the performance compared to last year. So the -- you can see the revenue was OMR 167.79 million compared to OMR 158.49 million. Net profit was OMR 23 million, and OMR 21.9 million in 2023. Net profit before financing cost was OMR 36.75 million compared to OMR 37.52 million. Total assets has reduced because of the depreciation, so it is now at OMR 508.55 million compared to OMR 523.66 million. Capital paid up, that's improved, the same [ as last year ], but the shareholder fund net assets has improved compared to last year, as you can see. And the term loan has reduced due to the repayment of the last years. Ordinary dividends are stable. So you can see it as same as last year. Net profit margin, it is now at 13.71%, and so return on capital, you can see there is improvement. It is as -- or 15.73% compared to 14.99%. And return on the capital employed, now at 8.83% compared to 8.58% last year. Debt-equity ratios have been improved, as you can see, as well. And net assets per shares also, there is an improvement. It's now at 182.19 baizas compared -- 171.89 baizas last year's. Basic earning per shares has also improved, now at 15.73 baizas compared to 14.99 baizas. Dividends per share is 5.25 baizas per share, same as last year. And also to highlight to you that, as we mentioned, the senior loan has been paid. And last repayment was OMR 18.38 million, which is equivalent to $47.8 million. And the interest of that was OMR 4.4 million and equivalent to USD 11.46 million. Dividends was distributed in Jan 2025, last payment of 2024. And the amount was OMR 2.92 million. So this is the end of the presentations. And now we will give you opportunity for any questions from your side, but we'll request you kindly to raise your hand and introduce yourself and if you are -- from which company you came. So please give your introduction, first of all, and then ask questions; and then we'll answer to -- your questions. [Operator Instructions] And we'll answer your questions.

I just want to know. What are the CapEx plans for the next...

Excuse me. Can you introduce yourself, first of all, and tell me from which company you are?

I'm [ Manna ]. I'm from [ United Securities ].

[ Manna ], yes.

Okay, so can you please provide some details on the CapEx plans for this year?

Sorry. CapEx...

Plan for this year...

Plans.

Actually our plant is -- we consider it as new. And there is no requirement for any CapEx during this period. We just do the regular maintenance as the approved plant. I have answered your question. Do you have any other question? Okay, thank you. Thank you for all, to attend this session's. We really appreciate your attendance and would like to thank you for that. And we wish you a very nice day. So thank you. This is the end of the presentation.