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But you are probably right that YTLPower share price may retest previous low given the current weak market sentiment. As long as its earnings outlook is still good and can maintain at least 5.0 sen dividend payout, I see this as an opportunity to accumulate more at even bargain prices, eg. at 0.63 it will yield 8%. Where else to find this high yield?

@kasinathan, no doubt the weak pound sterling will affect earnings contribution from Wessex Waters to YTLPower. The only "good" thing among all these negative developments is that Wessex's earnings is already expected to be weak in next few quarters given the high interest rates and high inflation environment there, so the weak pound effect on an already low earnings contribution will make the impact to YTLPower overall earnings not as bad.

With strong Singapore dollars, hopefully the increasingly strong earnings from PowerSeraya will be able to cover the weakening earnings from Wessex

Due to lower earnings in past few years, YTL Corp still gave away over RM300m of dividends every year, almost 100% of free cashflows (operating cashflows after debt service and necessary capex). This clearly shows that YTL management has endeavoured to distribute as much dividend to shareholders as possible at each company level, i.e. from YTL Power & Mcement & REITs to YTL Corp and from YTL Corp to all shareholders

@trader808, the total RM28bn of dividend payouts is the sum of dividends by all the listed entities of YTL group, i.e. YTL Corp, YTL Power, YTL REIT, SG REIT, YTL/MCement etc over the years.
In the good years of 2014-2017, total dividend payouts from YTL Corp alone already amounted to almost RM1.0 billion a year. (12 sen or RM1.289bn in FY2014, 10 sen or RM1.03bn in FY2015, 9.5 sen or RM1.03bn in FY2016, 5.0sen or RM600m in FY2017)

Things are looking up for YTL from its various new initiatives. Based on my earlier projections, YTL will register strong operating cashflows of over 10 sen per share as early as from FY2023 onwards, so it may be able to declare dividends of 5.0 sen or above from FY2023 onwards.

Back in 2014-2015, YTL was giving out dividends of 10 sen to 12 sen every year, and has distributed total dividends of RM28 billion over the years. As the Yeoh family is the largest shareholder in YTL Corp, so there is no reason to doubt that YTL will have all the intentions to declare high dividends as much as it can, as it will benefit the Yeoh family as well as all the minority shareholders.

No doubt that its share price has dropped from a peak of RM2.10 back in 2012-2014 to a low of 50 sen. That coincides with declining earnings in the past 10 years, the bulk of which was caused by unavoidable factors such as the expiring of Power Purchase Agreement for its Malaysian power stations despite numerous attempts to extend the contracts, the lack of large infrastructure projects in Malaysia that has caused soft demand for cement and COVID-19 pandemic that caused its hotel business to a standstill etc.
But we can see the YTL management has been trying hard to improve the company financials, for instance selling off non-core and peripheral assets such as some small land parcels at Genting for RM403 million, disposal of Dama Cement China for RM570 million and disposal of ELectranet Australia for RM3.066 billion, all at substantial profits (average at 275% premium to NTA), also the successful integration of YTL Cement into Malayan Cement, bagging the precious digital bank licence, starting of the green data centre park, and strong roll-out of 5G offerings etc.

With US Fed raising interest rates so aggressively, risky assets like bonds and stocks tumble across the globe. There is no good place to hide, hence many fund managers sell bonds and stocks in the rest of the world and move funds back to the US for the high interest rates and bond yields there, indirectly pushing up US dollars to decades high.

Where to park out money then? I would say a good place to park is in quality stocks that give high dividends with underlying business that is resilient and can withstand the onslaught of rising interest rates and strong USD.
YTL Corp will be one good candidate to consider - as its earnings outlook for next 2-3 years is still bright: YTL Power seeing strong earnings rebounds from PowerSeraya, potential turnaround in Yes business with strong takeups in its 5G offerings, maiden contribution from green data centre park and digital bank, strong operating cashflows from its cement division, strong rebounds in tourist footprints to its hotel business and shopping malls etc.

General market sentiment is weak with a lot of external uncertainties. Most companies and stocks are affected and down. If we look at share price performance of selected companies in past 3 months from 1st June 2022, YTL share price performance is not too bad:
Astro -20%
CIMB +2%
BPlant -37%
Genting -15%
Harta -60%
MRDIY -9%
Topglove -58%
MPI -10%
Inari -5%
YTL -12%
YTLPwr -7%

Correct, no need to monitor the stock market everyday. Invest in good stocks like YTL Power with a long term view then can sleep well, and just wait for the world class management to work hard and generate cashflows for dividend payouts to us twice a year.

With most stocks having declining earnings outlook, where will investors put money in? Can you still trade on speculative stocks? What story can drive up stocks anymore?
I would think that gradually people will find no other speculative stocks to goreng as stock market goes down the drain and trading volumes dry up. Then only dividend stocks with resilient business can find support from funds like EPF and KWAP.

News today says that there is a 98% chance for a global recession in 2023. Looking at the way things are going, I think very likely the US and Europe will go into a deep recession next year. Companies relying on export markets to the US and Europe will suffer the most, and tech companies will go down into a down cycle as consumer spending gets hit badly as US interest rates are hiked to probably 4.50%-5.00% by next year. Many companies with high debts will go bankrupt.

The only good place to hide is holding more cash to wait for good bargains next year and holding onto quality companies with resilient business models like YTL Power. With strong operating cashflows to support annual dividends of at least 5.0 sen per share, dividend yields may top 7% to give some buffer over rising interest rates / bond yields.

More worrying to me is the Russia-Ukraine war that may escalate further in coming months and the never-ending interest rate hikes in the US, such risks are hard to mitigate against at company level. Worst still is we do not know what to expect and what will happen

No doubt the rising interest rates, high inflation and depreciating pounds will negatively impact Wessex earnings contribution. I am hoping these impacts would be contained by water tariff adjustments from next year and rising contribution from Singapore at strong SGD

A total of RM541 million of provision was booked in by YTLPower in Q4FY2021 for re-measurement of deferred tax charges at Wessex Waters after the UK government announced a proposed tax rate hike from 19% to 25% from 1st April 2023. Now that the proposed tax rate hike has been cancelled, YTLPower should be able to write back the bulk if not all of this RM541m provision in its Q1FY2023 or latest Q2FY2023. Anyway this is non-cash item but will increase profits substantially.

@tonywong8, you are probably right for a tax writeback from Wessex after the tax rise was cancelled.

Thanks @xiaochen
This Yes unlimited 5G plan is competitive with TM unifi plan of RM129/month at 100 Mbps and RM168/mth at 300 Mbps. Though claimed to be 300Mbps, very often unifi users can only get 100-200 Mbps on average.

What is this wireless fibre 5G plan? How much GB and charge per month?

Be patient. YTL Corp should have a good chance to climb back to RM1.00 level in next 12 - 18 months

Superb results. 8 sen dividend. Full year dividend yield at 7.8%. Long term growth stock with high dividends.

https://klse.i3investor.com/web/blog/detail/dragon328/2022-08-29-story-h1628813084-YTL_Corp_4QFY2022_Continuous_Improvements_in_Utilities_Hospitality_and_

https://klse.i3investor.com/web/blog/detail/dragon328/2022-08-29-story-h1628813084-YTL_Corp_4QFY2022_Continuous_Improvements_in_Utilities_Hospitality_and_

https://klse.i3investor.com/web/blog/detail/dragon328/2022-08-29-story-h1628812225-YTL_Power_4QFY2022_Clear_signs_of_Earnings_Growth_in_Singapore

A brief update on YTL Power

https://klse.i3investor.com/web/blog/detail/dragon328/2022-08-29-story-h1628812225-YTL_Power_4QFY2022_Clear_signs_of_Earnings_Growth_in_Singapore

A brief update on YTLPower quarterly result and key business segments

No update on the Jordan project yet pending the arbitration case. Though I think the odds of YTLPower winning the case is very high, but ultimately it comes down to where the pay checks will be.
Due to years of under-investment in local power generation industry, Jordan is facing severe issues of power shortage and needs to rely on expensive imported fuel. The national utility Nepco is not in the best position to take on huge payments for new power generation, though the shale-oil fired power station would be very good for the country as it would use indigenous fuel which is abundant in the country and which cost will not fluctuate with international oil prices.

well said @xiaochen

Another superb set of quarterly results. Thumbs up for Padini management!

I am not too sure but think YTLPower has written off some development costs related to Tanjung Jati project, as mentioned by RHB Research too.

Tanjung Jati is a huge coal-fired power plant project to be developed under a 30-year Power Purchase Agreement with Indonesian PLN. Aside with environmental issues and lack of financing interests for high carbon projects, the current super high coal prices have made this project not feasible in relation to other renewable projects like geothermal and solar power in Indonesia.

Personally I do not think this project will go ahead.

too many day traders and short term punters taking profit after good result

Another record quarterly results. Super strong operating cashflows of over RM160 million for H1FY2022, annualised to RM320m or 26 sen per share. Reserve RM70m for planned expansion capex, SEM will still have RM250m of free cashflows a year or almost 20 sen per share.
I expect imminent re-rating, just like the case of BJFood.

Another record quarterly profit of RM21.9 million for 4QFY2022, more than 10x higher than last year.
Full year operating cashflows were super strong at over RM75 million or 37 sen per share, hence supporting super high dividend payout of total 19.0 sen for FY2022.

As expected, there is no surprise in the final dividend payout. Total 4.5 sen for FY2022 is still decent to yield 6.25%. Operating cashflows before capex for FY2022 amounted to RM1,577 million, we can expect higher for FY2023 hence higher dividends next year.

YES continued making losses, which is a disappointment too. I gathered that YES could have gained ~300k-500k 5G users during the quarter, at average RM15-20 per sim card, it would have generated revenue of RM15-30 million for the quarter which was not significant enough to turn around the telco business segment.

Hence, it will need to work harder to add another 1 million 5G users minimum in order to generate meaningful profits for the telco segment.

Wessex profit contribution is a disappointment. The qtrly report blamed it on higher operating costs and higher interest costs. As sensitivity checks, a 1% increase in average interest rates would increase Wessex' interest costs by RM12.8bn x 1% = RM128 million a year or RM32 million a quarter.

That still cannot explain the huge drop in PBT from RM89m to RM14m, unless interest rates have gone up by 2% or more.

Higher operating costs are expected as inflation is high in the UK.

There is mechanism in the water tariffs that adjust for higher interest rates and higher inflation, but will have a lag effect. I think this quarter PBT is exceptionally low and expect earnings to normalise when water tariff adjustments kick in to compensate for higher interest rates and higher inflation.

Current quarter PBT for PowerSeraya jumped to RM191m, annualised to RM764m which is well within my earlier projected range of RM530-1,150m for the full year. I hope the current quarter momentum of PowerSeraya can continue into FY2023, if not better.

Core operating cashflows before capex were strong at over RM1.5 billion for FY2022, expect higher for FY2023.

Record quarterly earnings. Thumbs up!