State Owned Enterprises

Public Enterprises

Financial Snapshot 2020 – For All PEs

ALL PEs
Audited Financial Highlights (T$’000) 2016 2017 2018 2019 2020* 5-yr Average
Revenue 132,211 146,900 157,724 165,934 139,392 148,432
Net Profit After Tax 15,081 13,301 15,431 10,987 4,930 11,946
CSO payments
Total Assets 414,708 470,849 500,652 501,489 426,602 462,860
Total Liabilities 173,823 222,898 242,991 239,649 206,005 217,073
Shareholders’ Funds 240,913 247,952 256,578 262,148 221,089 245,736
ROE % 6% 5% 6% 4% 2% 5%
ROA % 4% 3% 3% 2% 1% 3%
Asset Utilization 32% 31% 32% 33% 33% 32%

Financial Snapshot 2020 – For Each PEs

(T$ ‘000) Total Assets Total Revenue Total Liabilities Net Profit / (Loss)
Tonga Power Limited TPL 167,752 67,733 105,797 (698)
Tonga Market Corporation Limited TMCL 3,554 1,630 1,547 34
Friendly Island Shipping Services (2019) FISA 11,362 10,177 8,005 (2,886)
Tonga Broadcasting Commission TBC 6,752 1,777 4,666 (653)
Tonga Communications Corporation TCC 79,298 31,352 30,697 169
Ports Authority Tonga PAT 30,607 12,105 6,033 2,055
Tonga Water Board TWB 21,878 8,171 16,602 915
Waste Authority Limited WAL 6,573 4,884 4,399 637
Tonga Airports Limited (2019) TAL 71,029 14,345 32,752 1,993
Tonga Post Ltd TPost 21,918 2,109 16,115 208
Tonga Assets Managers and Associates Ltd TAMA 17,437 893 1,823 (268)
Tonga Cable Limited TCL 70,833 8,738 18,326 2,434
Portfolio 508,993 163,914 246,762 3,940

Portfolio ROE and ROA_PE Portfolio Assets 2020

Performance Highlights

The public enterprise portfolio has seen an overall decline in financial performance since 2018, with a sharp contraction in 2020[1]. A substantial loss incurred by Friendly Island Shipping and lower net profit by TPL contributed to the lower portfolio ROE and ROA in 2019, and all PEs (with the exception of TCL, TPost and WAL) suffered reduced profitability in 2020 as the Covid 19 pandemic precipitated an economic contraction.

During the 2016-2020 period, PAT and TPL contributed an average of 27% and 24% of total portfolio profitability, respectively, followed by TCL at 20%.  TCC, which had contributed 31% of portfolio profits in 2019, has seen that contribution drop to 4% in

More detailed analysis on the performance of the PE portfolio prior to 2016 can be found in:

Government’s Management of SOEs

Government exercises SOE ownership oversight through the application of the Public Enterprise Act. The Act was strengthened in 2010 – establishing a clear commercial mandate; improving accountability and reporting requirements; removing ministers from boards; establishing a robust CSO framework and enhancing governance. The Minister of Public Enterprises is solely responsible for all SOEs, although Cabinet must be consulted on certain matters, such as the appointment of directors and approval of CSOs.

The Public Enterprise Act (PE Act) requires summaries of SOEs’ annual reports, including reports on how successful the SOE has been in achieving the objectives and targets set in its business plan, to be published in local newspapers. This practice has been followed since 2010 when the requirement became effective. 90% of Tonga’s SOEs produce their audited financial accounts within the time frame established in the PE Act; with six months of the end of the preceding financial year.

The Establishing Acts for the SOEs are listed on their respective pages under the “Important Documents” heading.

SOEs are monitored by the Ministry of Public Enterprises.

Important Documents

Periodically the Government approves policies to provide guidance to the SOEs and assist the Government effectively manage its ownership interest. The following are key policies adopted by Government relevant to SOEs.

 

[1] 2020 numbers for ROE, ROA and total assets do not include TAL and FISA