Kenya Electricity Generating Company (KenGen) has reported a 9.2 per cent drop in net profit in first-half earnings compared with the same period a year earlier.
The listed firm reported KSh2.96 billion in net profit for the six months to December 2023.
This profit drop from the KSh3.26 billion reported in a similar period last year. Local currency devaluation and increased tax expenses ate into the earnings.
Operating Expenses increased by 16.4 per cent from KSh8.7 billion in 2022 to Sh10.10 billion last year.
The company attributed this to higher plant operating and maintenance costs occasioned by depreciation of the Kenya Shilling.
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Net finance income increased by KSh527 million from a net cost of KSh145 million to a net income of Sh382 million for the six months ended December 31, 2023 owing to increased return on cash investments.
“The operational environment for the aforementioned period was characterised by heavy rainfall that led to an increase in water levels within our hydro dams thus boosting hydro-generation by a remarkable seven per cent,” said KenGen Managing Director and CEO, Peter Njenga.
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He said the substantial boost in hydro-generation played a key role in mitigating the high fuel costs associated with thermal generation, which saw a commendable dip of 3.5 per cent.
The tax expense on the other hand rose from KSh1.488 billion for the six months to KSh1.871 billion representing a 25.7 per cent surge due to increase in foreign exchange losses owing to the depreciation of Kenya Shilling that are disallowable for tax purposes among other.
The performance has seen the firm pause issuance of interim dividends for the review period.
Last year during a shareholders meeting the director promised that power tariffs are expected to go down during the onset of the long rains.
By Fredrick Odiero
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