A-G’s Report: LTAT posts 27pc revenue boost, 13.1pc higher net profit in 2022

KUALA LUMPUR, March 6 — The Auditor-General’s Report (LKAN) on the financial statements of federal agencies for the year 2022 revealed Lembaga Tabung Angkatan Tentera (LTAT) reported a total revenue of RM0.653 billion in the fiscal year 2022, representing an increase of RM0.139 billion or 27 per cent from the previous year’s figure of RM0.514 billion.

According to the report, LTAT also witnessed a hike in the net profit, reaching RM0.433 billion in 2022, reflecting a 13.1 per cent increase compared to the RM0.383 billion recorded in 2021.

“In 2022, LTAT distributed dividends to contributors, totalling RM0.476 billion (5 per cent), utilising both the net profit and accumulated gains,” the report said.

However, the report also revealed that LTAT's reserves have consistently been in the negative territory since 2020, recording figures of RM0.376 billion in 2020, RM0.285 billion in 2021, and RM0.338 billion in 2022.

It said as of December 31, 2022, there are still 41 old stock portfolios that haven't been addressed, leading to an unrealised loss of RM0.662 billion, contributing to the negative reserve.

“LTAT invested RM5.288 billion in 13 subsidiary companies, including RM2.550 billion in Boustead Holdings Berhad and RM0.106 billion in Pharmaniaga Berhad, with the Net Tangible Asset Value for Boustead Holdings Berhad at RM1.783 billion and the market value for Pharmaniaga Berhad at RM0.062 billion as of December 31, 2022,” it said.

The report said LTAT did not provide specific details regarding the values of investments in Boustead and Pharmaniaga, amounting to RM0.768 billion and RM0.044 billion, respectively. T

“The lack of clarification resulted in a more apparent discrepancy between net profit and investments in subsidiary companies, totalling RM0.812 billion,” it said.

It is also revealed that LTAT sold shares of Perumahan Kinrara Berhad and Tanah Sutera Development Sdn. Bhd. worth RM0.043 billion to Perbadanan Perwira Harta Sdn. Bhd. (PPHSB) in exchange for PPHSB shares valued at RM0.232 billion.

From this transaction, it said LTAT recorded a non-cash gain of RM0.189 billion, which served as the basis for the 2022 dividend payment.

“The issue of dividend payment based on non-cash gains was also raised in the 2021 financial year, involving a non-cash gain of RM0.224 billion,” it said.

To improve investment performance and dividend payments, the report recommended reviewing and restructuring the investment strategy by diversifying investments and avoiding overconcentration in subsidiary companies to minimize risks and income dependence.

“Enhancing investment management governance by refining investment policies, enabling the effective handling of stocks experiencing prolonged losses.

“Ensuring the basis for dividend declaration is grounded in real profits, safeguarding the ability to pay eligible contributors in the future,” it said.