Kenya Power announces Kshs.319 million net profit for half-year period

Kenya Power has today announced that it has made Ksh. 319 million in net profit compared to Ksh. 1.1 billion loss made the previous year. Below is the full statement 

Kenya Power Profit for Half-Year Period

Kenya Power has recorded KShs. 319 million in profit after tax for the half year period to December 2023, marking an improvement from a loss of KShs. billion recorded during the previous half year period to December 2022.

The improved profitability was driven by growth in revenue resulting from increased electricity sales as well as the implementation of a cost reflective tariff. During the period under review, revenue from electricity sales grew by 31% to KShs.113.6 billion.

In the period, the Company commenced the deployment of a Rapid Results Initiative (RRI) which is meant to fast track meter installation for new connections across the country as a measure to drive customer connectivity and grow electricity sales.

"I am glad to note that our sales growth was driven by our deliberate effort to grow our customer numbers, having surpassed our connectivity target for the half year period by 13.87% with a total of 225,000 new customers to the grid," said Kenya Power's Managing Director & CEO, Joseph Siror.

Over the six-month period under review, there was a 240GWh increase in electricity units purchased and dispatched from renewable energy sources. Following increased uptake of energy from renewable sources, consumption of thermal generation reduced by 93GWh from 650GWh in the similar period in 2022 to 557GWh leading to a KShs. 2.05 billion reduction in fuel cost charge on customer bills.

Despite the impressive growth in revenue and significant reduction in fuel cost charge, finance costs increased by KShs. 7.6 billion, mainly due to unrealized foreign exchange losses on loan revaluations as a result of the depreciation of the Kenyan shilling against major foreign currencies. Foreign currency denominated loans account for 90% of the Company's loan portfolio.

"We are happy to note that the Shilling is gaining against the Dollar and other major currencies in the current period. We hope that this positive trend continues in the remaining part of the year to ease our forex exposure and enable US to finish the year at a stronger financial position," said Dr. (Eng.) Siror.

Similarly, operating costs increased by KShs.1.7 billion during the period under review to KShs. 19.7 billion, driven by higher electricity wheeling charges as provided in the cost-reflective electricity tariff and increase in depreciation. This is in addition to higher staff costs following onboarding of new staff to reinforce field operations and enhance overall operational efficiency to improve service delivery to customers.

To further sustain profitability, the Company will intensify the deployment of initiatives that are aimed at bolstering sales, optimizing revenue collection and enhancing system efficiency.

"While we are keen to onboard new customers, our immediate focus is to enhance customer experience. Therefore, in the period ahead, we will step up our investments in the network to fortify its reliability. This aligns with our core mission of providing affordable, clean, reliable and sustainable power to Kenyan households and enterprises," said Dr. (Eng.) Siror.