Kenya Power has reported a profit after tax of Ksh 30.08 billion for full year ending June 30, 2024 to reverse losses the utility reported last year.
A strong shilling supported by a strong revenue from power sales saw Kenya Power recover from Ksh 3.19 billion loss the firm posted over the same period last year.
During the year, profit before tax shot to Ksh 43.67 billion from a pretax loss of Ksh 4.43 billion.
“This performance was primarily driven by 21pc increase in revenue notably from commercial and industrial sector and decreased finance costs due to the strengthening of the Kenya shillings against major global currencies,” said Kenya Power.
During the period under review, revenue from electricity sales surged to Ks 231.12 billion from Ksh 190.98 billion reported last year.
Increased electricity sales was driven by additional 447, 251 new customers connected to the grid, improved economic activities from the manufacturing sector as well as the implementation of a revised cost-reflective base tariff structure in April last year.
Finance costs on the other hand eased to Ksh 682 million from Ksh 24.15 billion reported last year on account of a stronger local currency.
“During the year finance costs decreased by Ksh 24.84 billion mainly due to unrealized foreign exchange gain of Ksh 7.88 billion compared to a loss of Ksh 16.87 billion in the previous period as a result of loan revaluations. This gain was due to the appreciation of the Kenya shilling against the US dollar and euro, both of which represent approximately 90pc of our loan portfolio,” the firm stated.
Power purchase costs widened to Ksh 150.61 billion from Ksh 143.58 billion as gross margins rose to Ksh 80.52 billion compared to Ksh 47.40 billion last year.
“While the company’s revenues are billed entirely in Kenya shillings, power purchase contracts are predominantly denominated in foreign currencies. As a result, the strengthening of the shilling in the second half of the year led to an increase in cost of sales that was lower than the growth in revenue, thus contributing to the higher gross margin,”
During the year under review, Kenya Power also posted a 24pc increase in operating expenses from Ksh 37.28 billion last year to Ksh 46.28 billion.
