Kenya Power Records Sh30 Billion Profit, Ending Previous Year’s Loss
Kenya Power, the country’s listed electricity distributor, reported a net profit of Sh30 billion for the financial year ending June 30, 2024, a sharp turnaround from a Sh3.19 billion loss in the previous period. This remarkable recovery is attributed to increased sales from industrial and commercial clients, coupled with a stronger shilling against the US dollar.
Revenue Growth and Forex Gains
Sales grew by 21%, reaching Sh231 billion, up from Sh191 billion in the prior year. The power company’s financial position also benefited from a Sh25 billion drop in finance costs, largely due to an unrealized foreign exchange gain of Sh7.9 billion, compared to a loss of Sh16.9 billion the year before.
Dividend Announcement: The board has proposed a dividend of Sh0.70 per ordinary share, marking the first payout after a long dividend hiatus.
Financial Highlights and Cost Adjustments
Kenya Power noted a significant decrease in finance costs, dropping by Sh24.84 billion due to foreign exchange gains stemming from the shilling’s appreciation against the US dollar and euro, which represent about 90% of its loan portfolio. The cost of power purchases rose to Sh150.61 billion from Sh143.58 billion in the previous year, driven by increased demand and early-year exchange rate fluctuations.
The company’s revenue is fully billed in Kenyan shillings, but many power purchase agreements are tied to foreign currencies. Consequently, the shilling’s strength in the latter half of the year helped contain cost-of-sales growth relative to revenue, enhancing Kenya Power’s gross margin.
Operational Expenses and Network Expansion
Operating expenses grew to Sh46.28 billion, compared to Sh37.28 billion in the prior year. This increase was mainly due to higher transmission and distribution costs—driven by a 92% rise in wheeling charges related to expanding the transmission network—and additional staffing to support operational needs.
Kenya Power’s improved financial performance and strategic cost management highlight its resilience and operational scale-up to meet rising demand while containing costs in a challenging economic environment.
