Taiwan Power Co (Taipower, 台電) plans to issue NT$20.8 billion (US$676.64 million) in unsecured corporate bonds next month to boost its working capital after experiencing heavy losses this year, the state-owned utility said yesterday.
The planned bond sale aims to ensure that the company has the working capital needed to maintain an adequate supply of electricity, Taipower said in a statement after its board approved the plan.
The debt is to comprise NT$6.4 billion of three-year bonds with a coupon rate of 1.60 percent, NT$8 billion of five-year bonds with a coupon rate of 1.65 percent, NT$3.2 billion of seven-year bonds with a 1.80 percent coupon rate and NT$3.2 billion of 10-year bonds with a coupon rate of 1.90 percent, Taipower said.
Photo: George Tsorng, Taipei Times
Taipower’s accumulated losses were NT$172.3 billion as of the end of October due to rising international energy prices, especially natural gas, it said.
Due to the war in Ukraine, Taipower in the first 10 months of this year spent NT$500.7 billion on energy, up sharply from the NT$263.5 billion it spent during the same period last year, it said.
The utility’s soaring costs reflect Taiwan’s continued dependence on fossil fuels for its power supply. In the first 10 months, 42.4 percent of Taiwan’s electricity was derived from coal and 38.4 percent from natural gas, Taipower data showed.
Taipower generated 68.7 percent of the country’s electricity supply, with the rest coming from private plants that sell their output to Taipower. Data showed that 43.1 percent of Taipower’s output came from natural gas and 38 percent from coal.
Although Taipower reported accumulated losses of NT$230.2 billion as of the end of October, the figure was lowered to NT$172.3 billion due to a change in accounting standards, the company said.
The accumulated losses nonetheless represent more than 50 percent of the company’s paid-in capital of NT$330 billion, which led Taipower’s board to approve a plan last week, based on the company’s charter, to sell NT$150 billion in new shares to boost its paid-in capital.
The Ministry of Economic Affairs is likely to purchase all of those shares, Taipower said.
Additionally, Taipower’s board has also approved a plan to raise the ceiling of the company’s capital scale to NT$600 billion, from NT$400 billion, paving the way for the issuance of new shares.
The bond issuance increases Taipower’s debt, which rose steeply in the first 10 months to NT$2.14 trillion as of the end of October, up from NT$1.82 trillion a year earlier.
Of that debt, NT$1.33 billion was short-term, up from NT$1.07 billion a year earlier.
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