MARC Ratings has affirmed its AAAIS(bg) rating on Ranhill Sabah Energy II Sdn Bhd’s (RSEII) outstanding RM250.0 million Islamic Medium-Term Notes Programme with a stable outlook.
The rating reflects the unconditional and irrevocable guarantee provided by Bank Pembangunan Malaysia Berhad (BPMB), rated AAA/Stable by MARC Ratings.
RSEII owns and operates the 190MW combined-cycle gas turbine Rugading Power Station in Sabah under a 21-year power purchase agreement (PPA) with offtaker Sabah Electricity Sdn Bhd, a subsidiary of Tenaga Nasional Berhad.
The plant maintained strong performance, with the unplanned outage rate remaining within the PPA-stipulated 4.0% limit, resulting in full capacity payment of RM69.1 million in 2024. The heat rate also met the PPA requirement, enabling full cost pass-through to the offtaker. RSEII recorded RM131.9 million in energy payment for the year.
Operating profit improved to RM23.5 million (2023: RM18.4 million), with that of the prior year impacted by major maintenance costs. RSEII’s cash balance of RM85.6 million as at end-March 2025 is sufficient to cover the RM56.9 million principal repayment and profit payment due on June 17, 2025.
Under the base case cash flow projections, RSEII’s average and minimum finance service coverage ratios are 2.0x and 1.9x through 2029, with sukukholder interest protected by BPMB’s guarantee.