Kenya Power's profit after tax for the year to June stagnated as the firm struggled with increased transmission and distribution costs.
In a published statement on Friday, the State utility firm indicated it recorded a less than one per cent rise in its profit after tax, which stood at Sh 7.27 billion, as its transmission and distribution costs jumped 16.6 per cent from Sh28.7 billion to Sh33.4 billion over the period under review.
“The rise was attributed to higher operational and maintenance costs on the expanded electricity network, depreciation due to increased capital investment and the rising cost of doing business,” Kenya Power said.
The electricity distribution firm has undertaken an aggressive consumer connection programme in recent years to reach 6.2 million connections – or 70 per cent of the county’s 45 million population – by the end of June 2017.
Ken Tarus, Kenya Power’s managing director, told Reuters in an interview earlier this months that the State was planning to connect an additional 1.2 million customers to the grid by the end of the current financial year in June 2018.
He projected that an additional 3,400 kilometres of medium voltage power lines will be added to its grid by June next year. This would be half of what was built in the previous financial year.
The company’s total revenue was up 11 per cent to Sh120.7 billion mainly due to a near doubling of fuel cost recharged consumers to Sh 22 billion from Sh 12.5 billion.
This was attributed to increased usage of thermal sources during a prolonged drought earlier in the year. Most the electricity generates in the country is from rain-fed hydro stations that are occasionally affected by drought spells.
There has been increased efforts to diversify power sources in the country from hydro-powered generators to geothermal, solar, wind and even nuclear.
Kenya Power maintained a Sh0.50 dividend per share for the year under review. It will hold an AGM meeting on Dec 1 to approve the dividend payout.