Kenya Power and Lighting Company (KPLC) has issued a profit warning, stating that its net earnings for the financial year ending 30th June 2018 are projected to be lower than 25 per cent than those reported for the financial year ended 30th June 2017.
Last year, the company recorded a net profit before tax of sh10,912 million during the year which was lower than sh12,083 million the previous year.
“The warning is based on the un-audited results for the financial year ending 30th June 2018 and the evaluation made by the Board, with reference to figures and information currently available”, read a statement published in local dailies by Acting Managing Director Jared Othieno.
The statement explained that revenue growth for the year was constrained by the depressed economic environment, poor hydrological conditions in 2017 and the protracted electioneering period. “This slow business environment led to a significant decline in the Company’s financial performance.”
It added that the increased financial costs and delayed review of retail electricity tariffs led to reduced earnings.
Last year, revenue from electricity sales excluding foreign exchange adjustment and fuel cost recoveries increased by 5.6 percent to sh91,952 million from sh87,081 million realised the previous year.
Eng. Othieno said that KPLC is taking cognizant of these development and is looking to improve customer experience, financial sustainability, diversification of revenue streams and engagement with stakeholders to spur demand.
During the 96th Annual General Meeting of its shareholders of in December 2017, Amb (Eng) Mahboub Maalim Mohamed was elected chairman of the Board alongside Mr. Adil Khawaja and Mrs. Zipporah Jesang Kering as members.