Cash-stripped Kenya Power is looking to make an extra shilling with the commercialization of its garage as well as leasing out land.
The company has been struggling financially as its losses keep dropping. Kenya Power recently reported a 92% decrease in profits tanking to Ksh262 million for the financial year ended June 2019.
In an attempt to salvage its finances and get back their profits back up, the company is looking to commercialize its garage and lease out idle land. Kenya Power’s Managing Director Bernard Ngugi said that the company expects the new avenue to diversify revenue streams and support electricity sales.
“We have a transport section and we want to open that as a public garage since it is idle at the moment. We also want to lease out idle land,” said Ngugi, “The garage sits on huge land and we will liaise with insurers to give us an opportunity to repair vehicles. Going by the growing numbers of vehicles on roads, it is a potential business.”
However, he did not give the estimated monetary potential of the new ventures. He added that the garage business will be handled by its subsidiary, Kenya Power International. The subsidiary was started four years ago as part of Kenya Power’s business diversification strategy.
Apart from the garage, the company also owns six pieces of land in Mombasa, two in Nakuru, two in Eldoret and several others in Nyeri and Nairobi which it looks to lease. Kenya Power is also planning to revive and expand its fibre business.
See Also>> Kenya Power Profits Plunge 92% to Sh262mn
Kenya Power started the fibre business in 2010 and has already signed around 5 to 20- year lease agreements with several telecommunications operators. The company’s MD noted that the fibre business gives an average of Ksh 500 million every year and that the company wants to boost the figure.
The utility firm had earlier announced that it wanted to grow the fibre network and provide inter-connection from Kenya to the entire Common Market of Eastern and Southern Africa.
The new ventures are an attempt to keep the utility firm afloat as other companies struggle to operate in Kenya’s current dwindling economy. Kenya Power’s profit plunge affected the company’s share prices as they dipped 6.4% to Sh2.49, the lowest level since 2003 when it was in losses.
The company also recently sent home 110 employees over involvement of fraud and illegal connections. The illegal connections have played a huge part in the company’s current financial situation.
Western Stima, a football team sponsored by Kenya Power, has also felt its pinch of the hard times at the utility firm. Injured players in the team had their contracts terminated as the team management cited lack of finances as the main reason.