The Kenya Power and Lighting Company (KPLC) has recorded a profit after tax of Ksh30.08 billion for the financial year ended June 30, 2024.
In a press release on October 29, 2024, KPLC announced that it has returned to profitability, which marks a turnaround from a net loss of Ksh3.19 billion net loss for the year ended June 2023.
The listed firm posted the Ksh30.08 net profit on the back of increased sales and a strong shilling that reduced its costs.
This comes as revenue from electricity sales grew 21 percent to Ksh231.12 billion from Ksh190.98 billion on increased consumption.
According to KPLC, this growth is attributed to improved sales primarily from the 447.251 new customers connected to the grid during the year, as well as increased economic activities, particularly in the manufacturing sector.
“Implementation of a revised cost-reflective base tariff structure in April 2023 also contributed to the improved sales,” the statement adds.
During the year, finance costs fell sharply by Ksh24.84 billion to Ksh682 million from Ksh24.1 billion a year earlier, underscoring the massive impact of the shilling’s rally on Kenya Power’s books.
“This performance was primarily driven by a 21 percent increase in revenue notably from the commercial and industrial sector and decreased financial costs due to the strengthening of the Kenyan shilling against major global currencies,” Kenya Power said in a statement.
KPLC performance
The shilling rallied to exchange at 128.4 units to the dollar at the end of the last financial year in June, compared with 140.45 units to the greenback a year earlier.
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On the other hand, power purchase cost increased from Ksh143.58 billion the previous year to Ksh150.61 billion. This growth was driven by additional units purchased to support rising demand, as well as the high exchange rate earlier in the financial year.
Operating expenses rose to Ksh46 28 billion, up from Ksh37. 28 billion in the previous year.
This increase in transmission and distribution expenditure was occasioned by a 92% rise in wheeling charges for the expanding transmission network and the recruitment of additional technical staff to support business operations.
Dividend
At the same time, Kenya Power has announced that it will pay dividends to shareholders, ending a seven-year drought.
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The board has proposed a first and final dividend of Ksh0.70 per ordinary share to shareholders in the register at the close of business on December 2, 2024. If approved, the dividend will be paid on or about January 31, 2025.
Kenya Power last paid a dividend in 2017 but froze payments in subsequent years amid shaky performance and increased demand for cash to run operations.
The utility has also benefitted from the falling electricity prices, which spurred demand from industries, homes and small and medium-sized enterprises.
KPLC has highlighted that it has made significant strides in enhancing its financial performance and position, as evidenced by increased sales revenue and improved working capital position.
Although the working capital remains negative, it has shown consistent improvement, increasing from negative Ksh74.85 billion in the FY 2019-2020 to negative Ksh27.44 billion by end of the year under review.
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