KenGen on Thursday, January 27 published its audited results for the financial year ended June 30, 2020. The power generation firm posted a strong performance despite the impact of Covid-19 which saw demand for electricity affected.
Profit before tax rose 18.3 per cent from Ksh11.654 billion to Ksh13.7 billion. Consequently, profit after tax improved by 133.1% to reach Ksh18.3 billion up from Ksh7.8 billion with a tax credit of Ksh4.5 billion.
The tax credit was largely due to the temporary reduction of the Corporate Tax rate from 30% to 25%, one of the relief measures introduced at the onset of the pandemic. The change led to a decrease in the deferred tax liability by Ksh8.1 billion.
KenGen attributed its strong performance to the full operationalization of its 165MW Olkaria IV geothermal power plant in November 2019, which boosted geothermal production by 14 per cent.
The KenGen board proposed a first and final dividend for the year of Ksh0.30 per ordinary share held.
KenGen notably recorded a 13.4 per cent growth in electricity revenue.
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“Demand for electricity was partly affected in the second half of the year, owing to restriction measures to stop the spread of Covid-19.
“However, with the gradual opening of the economy, the peak demand has grown to 1,976MW recorded on December 10, 2020, surpassing the pre-Covid-19 peak demand of 1,926MW,” the firm noted.
The company noted that its main dams recorded full reservoir capacity during the year thanks to favorable hydrological conditions.
Hydro production, however, declined by 2% with KenGen citing constrained demand associated with restriction measures to stop the spread of Covid-19.
The company notably managed to grow its renewable energy footprint despite a drop in wind generation.
Geothermal made up 52% of KenGen’s energy mix for the year, up from 45% in 2019.
“The increase in geothermal generation displaced the need for thermal generation which declined by 63% which also compensated for the reduction in wind generation, thereby increasing KenGen’s renewable energy footprint,” the firm observed.
In 2021, the company aims to add 83.3MW to the national grid by delivering the Olkaria 1 Additional Unit 6 Geothermal Power Plant. KenGen is also banking on contracts in neighboring Ethiopia for growth.
“We also aim to scale up diversification of revenue streams through exploration of further regional and local opportunities, with a focus on delivery of the ongoing projects in Ethiopia,” the firm noted.