Electricity generator KenGen on Thursday reported a 9% reduction in profits for the full year ended June 2019 to Ksh7.88 billion from Ksh7.89 billion posted the previous year, results that had remained unaudited due to the vacancy in the Auditor General’s office.
Profit before tax stood at Ksh11.65 billion down from Ksh11.74 billion as revenues ticked up to Ksh45.96 billion up from Ksh45.29 billion.
The group’s balance sheet increased to Ksh401.4 billion in FY 2019 from Ksh375.3 billion in FY 2018 even as the company’s operating profits adjusted up to Ksh15.2 billion up from Ksh11.4 billion.
Operating expenses however increased from Ksh9.97 billion to Ksh10.57 billion due to plant operation and maintenance and adoption of IFRS 9.
According to Chief Executive Rebecca Miano, during the period under review, energy sales grew from 7889 Gigawatt hours in 2018 to 8277 in 2019 despite the entry of new players into the capital intensive but lucrative business.
Conversely, no power plant was commissioned during the period under review meaning the company did not benefit from tax credits that accrue from commissioning new power plants.
“The 165.4MW Olkaria Geothermal Plant was under construction during the year, it was completed and connected to the national grid in November 2019,” said Ms Miano.
Electricity revenue grew by 1.7% to Ksh29.3 billion in 2018 to Ksh29.8 billion for the full year ended June 2019.
Stream revenue declined by Ksh5.6% from Ksh6.2 billion to Ksh5.9 billion on reduced geothermal dispatch.
According to the Chief Executive, the company has diversified its revenue streams by identifying new business lines including consultancy and drilling services.
“We have secured various contracts in Kenya and Ethiopia for geoscientific studies and drilling of geothermal wells. We are also progressing well with the development of an energy park, operationalization of materials testing laboratory and electronic instruments calibration centre among other business lines,” the Chief Executive said in the statement.
Consequently, the board declared a final dividend of Ksh0.25 for the year for every ordinary share of Ksh2.50 which amounts to Ksh1.6 billion down from Ksh2.6 billion in 2018.
The company’s Annual General Meeting (AGM) is pencilled in for October 22, 2020.