Kenya Power on Thursday engaged journalists in a cat-and-mouse game, buying more time to release financial results amid fears that it has recorded a near-history loss.
In July, the power distributor projected to record a gross loss of Sh5.5 billion, in what could mark the second worst results in a decade after a Sh6.04 billion loss before tax reported in 2017.
The National Treasury told the International Monetary Fund (IMF) that the listed power utility firm's performance for the year would be hit by weak shilling and drought, cutting gross profits from Sh5.1 billion posted last year.
The exchequer projected the power firm's net revenue to grow by 11 per cent to Sh174.98 billion but a surge in expenses is set to push it into the loss position.
It projected its net revenue to grow by 11 percent to Sh174.98 billion but a surge in expenses is set to push it into the loss position.
The government said Kenya Power's operating expenses will rise from Sh38 billion to Sh42.6 billion while financial expenses will grow by a third to Sh16.4 billion from Sh12.3 billion, piling pressure on its bottom line.
Even so, the company had in May warned that its profits would drop by at least 25 per cent, meaning its earnings will not surpass Sh2.63 billion compared to Sh3.5 billion recorded last year.
Kenya Power has over the past few years heavily turned to the Exchequer for bailouts with the IMF saying that the utility’s liquidity gap was Sh64 billion as of June last year.
“The 2023 comprehensive revision of base electricity tariff and a Cabinet approved action plan to strengthen KPLC’s financial health should be steadfastly implemented while monitoring any residual fiscal risks,” the IMF report reads.
The company which had returned to the profit side has had a six-year dividend dry spell, forcing the top management to do an overhaul of its board to accommodate real shareholders and protect minority owners.
The utility firm posted a net loss of Sh1.1 billion for the half-year ended December 2022 attributing the drop to the widening foreign exchange losses.
The company had not released official results by the time of going to press, with the management claiming hey were awaiting clearance from the Capital Markets Authority.
They had invited journalists for a media briefing at 3pm, Thursday.
