KenGen half year earnings double to Ksh.8.2B, growth flat in full year
Electricity generating firm KenGen has announced the doubling of earnings in six months to December 31 to Ksh.8.2 billion in Friday’s dual disclosure of its trading results.
The firm has subsequently disclosed a flat growth in profit to Ksh.7.9 billion in its delayed full year trading results to June 30 forced upon by the pending appointment of the Auditor-General.
The reported earnings across both period are largely attributable to growth in non-revenue based gains from other income and alternative net gains.
Non-revenue income across the six months period grew to Ksh.479 million and Ksh.246 million from Ksh.211 and Ksh.158 million respectively to see net revenues hit Ksh.19.6 billion from Ksh.18.4 billion last year.
Revenues from electricity sales meanwhile grew to Ksh.16 billion from Ksh.15 billion last year with wind and geothermal sources growing their contribution in the revenue mix by one and two percentage points respectively.
KenGen further received a tax credit amounting to Ksh.1.9 billion from capital allowances arising from its completion of Olkaria IV 165 MW (megawatt) plant to reverse a previously negative charge on tax.
Expenses in the period were however on the rise to hold down the company operating profit at Ksh.6.7 billion with the firm facing higher depreciation and amortization costs from its Olkaria IV project alongside an adoption on the right of use assets following the adoption of IFRS 16 accounting standards.
KenGen however found footing from lower financing costs in the period from the retirement of its infrastructure bond pay out.
The company expects to stay on the growth curve from increased power generation activity and an expectation of growth in power demand.
“We continue to focus on our revamped strategy which is to grow our core business of power generation amid an increasing competitive market. In addition, we are pursuing best operational practices and our power plants continue to deliver the lowest priced energy,” noted KenGen CEO Rebecca Miano.
Further, KenGen is expected to drive its business diversification strategy through ongoing geothermal drilling and consultancy services projects in Ethiopia and Kenya.
The board of KenGen has held its declaration of a dividend to shareholders from its full year earnings until the final audit of results while halting a recommendation on dividends for its half year earnings.
The underling company performance has however seen the firm’s earnings per share (EPS) improve drastically to Ksh.1.24 in six months to December 2019 from a lower return of 63 cents in 2018.
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