Exploring Green Options

Narjis Dawood Al Lawati, Acting Group Senior Manager – Corporate Finance Nama Holding gives an overview of the Group’s Sustainable Finance initiatives

Can you give us an overview of Nama Holding’s financial performance in the last couple of years?

Nama Group has been doing well financially over the last few years. The EBIDTA (Earnings before Interest, Depreciation, Taxes and Amortisation) levels have been increasing. We have a healthy balance sheet, a good P&L (Profit and Loss) position meeting and achieving the targets of our shareholders. The merger of Water & Wastewater services has added value to Nama Holdings performance. In financial year 2022, the implementation of the regulatory mechanism helped in a significant growth of Nama Group’s EBIDTA and we are maintaining a healthy financial position.

How is Nama Group promoting financial sustainability?

A restructuring of the electricity sector is being undertaken and as a part of the process we are trying to restructure the debt profiles of the companies so that we can ensure Sustainable Financing structures for the companies not only for their previous and existing debt but also for future requirements. We consistently try and seek better terms, negotiated prices and favourable commercial terms from banks both internationally and locally and this has enabled us to strengthen financial sustainability.

Is the move towards renewables expected to lead to a higher return on investment (ROI) in the coming years?

Oman Power and Water Procurement Company (OPWP) - which is the sole buyer of water and electricity is the company within the Group which deals with issues such as whether to use conventional energy generation or to produce green energy from renewables.

On the other hand, irrespective of whether a shift towards renewables increases our return on investment, we are pursuing Green energy and Sustainability initiatives as there is a demand for this energy and it is good for the country and humanity. Overall, we are trying to lower carbon emissions by burning less fuel and gas and moving towards green energy. The Group has floated a number of tenders for Renewable Energy projects and we expect such power plants to generate close to 1,000 MW in the next two to three years.

Nama Group has done a lot in terms of digitalisation from smart metering to electronic billing etc. Have these helped in improving the Group’s bottom-line?

Implementing the latest technology helps us in improving our meter reading systems, better collection and customer service and we do not correlate it to ROI or equity. Digitalisation is a mandate as it helps customers, brings in advanced technology and ensures better cash management.

How important is cost saving, prudent financial policies and improving efficiencies for Nama Group?

As a regulated company we are always looking at improving our cost efficiencies. The Group’s restructuring in line with the directives of Oman Investment Authority aims to bring in cost savings and increase supply chain efficiencies. For example, instead of having 5 distribution and supply companies, the Group could have 2 of these companies helping in leveraging synergies and consolidating contracts. While all the advantages may not materialise in one year the Group will definitely benefit from these cost saving.