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Kenya Power posts Sh30bn net profit in Year ended June 30
The net profit is from a Sh3.19 billion loss the previous year.
3mon agoVICTOR AMADALARealtime
Kenya Power has reported a Sh9.9 billion net profit for the six-month period to December 2024, as the utility firm continued on a strong run in profitability since bouncing back last year.
This is compared to the Sh319 million profit after tax reported in a similar period last year.
This year's growth in profitability is attributed to lower cost of sales and reduced finance costs owing to the stability of the Kenya Shilling against major foreign currencies during the period under review, and an increase in electricity sales by five per cent from 5,225 GWh to 5,506 GWh.
"The increase in electricity unit sales was driven by higher consumption as a result of improved network reliability, connection of new customers and improved outage resolution timelines supported by the availability of critical materials including meters and transformers," Kenya Power said in its financial statement.
Despite this increase, the overall electricity revenue reduced by 5.4 per cent from Sh113.5 billion in December 2023 to Sh107.4 billion in December 2024.
This reduction is attributed to lower passthrough costs as the Kenya Shilling remained stable during the period and had a lower average yield as per the tariff reduction path embedded in the approved tariff.
Power purchase cost decreased by Sh1.65 billion to Sh71.4 billion in the period under review, riding on the strengthening of the Kenya Shilling against major foreign currencies in which the majority of Power Purchase Agreements (PPAs) are denominated.
"This cost reduction was further supported by an optimised generation mix dispatched during the period," the company noted.
A total of 6,603 GWh of renewable energy was purchased, an increase from 6,199 GWh in the previous half-year period.
Operating expenses rose by Sh4 billion, from Sh19.7 billion in the previous half-year period to Sh23.7 billion.
This increase is attributed to higher operational expenses including staff costs, depreciation and other maintenance costs incurred to support the expanded network.
During the period, the company commenced repayment of the government on-lent loans that had remained on a repayment moratorium since March 2020.
The working capital position continued to improve during the review period, increasing by 30 per cent from negative Sh27.4 billion in June 2024 to negative Sh18.9 billion in December 2024, as management continued to optimise financial resources towards achieving financial sustainability.
The board has announced an interim dividend of Sh0.20 per share.
"Looking ahead, we are committed to sustaining our improved financial performance through targeted initiatives that enhance efficiency, diversify revenue streams, and drive long-term growth," the management affirmed.
The Company is advancing the transformer metering project to improve energy balance and system efficiency.
Kenya Power is also keen to capitalise on the anticipated lifting of the moratorium on new power generation contracts to increase electricity sales as peak demand increases.
