Kenya Power and Lighting Company has reported a profit of Ksh 319 million for the half-year period ending December 2023, marking a significant turnaround from the previous year’s loss. Despite facing challenges such as increased finance costs and operational expenses, the utility company has demonstrated resilience and strategic growth.
The surge in finance costs, amounting to Ksh 7.6 billion, was primarily attributed to unrealized foreign exchange losses on loan revaluations caused by the depreciation of the Kenyan shilling against major foreign currencies. With 90% of its loan portfolio denominated in foreign currencies, Kenya Power felt the impact of currency fluctuations keenly.
However, the company’s Managing Director, Joseph Siror, expressed optimism about the recent strengthening of the Kenyan Shilling against international and regional currencies, hoping that this trend would alleviate forex exposure and bolster the company’s financial position.
Despite the financial challenges, Kenya Power saw a remarkable improvement in profitability, driven by increased revenue from electricity sales and the implementation of a cost-effective tariff. Revenue from electricity sales surged by 31% to Ksh 113.6 billion, reflecting growing demand for electricity across the country.
Operating costs also witnessed a notable increase, rising by Ksh 1.7 billion to Ksh 19.7 billion. This uptick was attributed to higher electricity wheeling charges and increased depreciation, as well as additional staff costs incurred to reinforce field operations and enhance overall operational efficiency.
One of the key initiatives undertaken by Kenya Power during this period was the deployment of the Rapid Results Initiative (RRI), aimed at accelerating meter installations for new connections nationwide. This initiative contributed to exceeding the company’s connectivity target by 13.87%, with 225,000 new customers connected to the grid.
Furthermore, Kenya Power reported a significant increase in electricity units purchased and dispatched from renewable energy sources, resulting in a reduction in thermal generation consumption and fuel costs for customers.
Looking ahead, Kenya Power plans to intensify investments in its network infrastructure to enhance reliability and fulfil its mission of providing affordable, clean, reliable, and sustainable power to its customers across the country. Despite the challenges posed by increased costs, the company remains committed to driving growth and delivering quality service to its expanding customer base.
