Kengen Delivers Kes24.7Bn Profit HY 2023 in surge of 8.4pc

Kenya Electricity Generating Company PLC (KenGen) has announced a commendable half-year performance, marked by a notable 8.4% surge in net revenue,reaching Ksh.24.7 billion for the six months ending December 31, 2023.

The NSE-listed energy generator attributed the positive outcome to favorable hydrology and heightened plant efficiency, setting the stage for sustained growth in Kenya’s energy sector.

“The operational environment for the aforementioned period was characterized by heavy rainfall that led to an increase in water levels within our hydro dams thus boosting hydro-generation by a remarkable 7%.

This 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%,” said the Managing Director and CEO, Eng. Peter Njenga.

Overall, electricity units generated demonstrated a modest improvement of 0.3%, reaching 4,211GWhs.

KenGen reported that the national electricity demand continued its upward trajectory, peaking at 2,170.56MW on December 19, 2023, underlining the growing significance of KenGen’s role in meeting the energy needs of the nation.

Net revenue’s robust growth, reflecting the impact of favorable hydrology and enhanced plant efficiency, is mirrored in the 1.8% improvement in profit before tax, which grew from Ksh.4.7 billion in 2022 to Ksh.4.8 billion in 2023.

The company’s operating landscape however witnessed a 16.4% increase in operating expenses, predominantly influenced by higher plant operating and maintenance costs stemming from the global macro-economic pressure.

At the same time, KenGen’s positive momentum was slowed by tax expense which surged by 25.7%, escalating from Ksh.1.48 billion in 2022 to Ksh.1.8 billion in 2023, primarily due to an increase in unrealized foreign exchange losses that are disallowable for tax purposes among others.

Consequently, Profit after tax declined by 9.2% from Ksh.3.3 billion in the corresponding period of 2022 to Ksh.2.9 billion in 2023.

KenGen maintains a positive outlook, underscoring the escalating national demand for clean electric energy citing noteworthy projects, including the rehabilitation of the Olkaria I geothermal power plant which KenGen says is well on schedule.

At the same time, KenGen says its Olkaria uprating project which aims to increase the combined capacity of two geothermal power plants from 300MW to 340MW is expected to be complete by December 2026.