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KenGen’s profit jumps 8.3pc to Sh13.9b for FY20 driven by Olkaria Five and Ethiopia projects

NAIROBI, Kenya, Jan 28 – Energy producer, KenGen, has announced a Sh13.9 Billion profit before tax for the Financial year ended June 2020.

This translates to 8.3 percent growth in profit from the previous financial year where the company announced Sh11.6 Billion profit before tax.

The increase was mainly attributed to the additional revenue contribution by the 165MW Olkaria V geothermal power plant and proceeds from the ongoing geothermal drilling project in Ethiopia.

“We reported a 13.4 percent growth in electricity revenue, mainly due to the full operationalization of the 165MW Olkaria V geothermal power plant in November 2019, which boosted geothermal production by 14 percent,” the Managing Director & CEO, Rebecca Miano, said.

Consequently, the Board has recommended a first and final dividend for the year of Sh0.30 per ordinary share of Sh2.50.

This will be presented during the company’s upcoming Annual General Meeting (AGM) for approval.

Recently, the company made a dividend payout of Sh1.65 billion to its shareholders.

At the same time, KenGen’s profit after tax improved from Sh7.88 billion to Sh18.4 billion, an increase that the company attributes to a Sh8.1 billion reduction in corporate tax rate from 30 percent to 25 percent as per the Government’s relief measures to support companies navigate through the COVID-19 crisis.

“We appreciate the support provided by the Government during this unprecedented time to enable us to continue providing electricity as an essential service,” said Miano.

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She further indicated that in as much as the country’s hydrological conditions were favorable with dams recording full capacity, hydropower production declined by 2percent following constrained demand associated with the effects of COVID-19 pandemic on electricity consumption.

Miano stated that in response to the pandemic, KenGen continued to implement business continuity measures to minimize the impact of the pandemic on operations to ensure continued generation of electricity.

During the year ended June 2020, KenGen’s operating expenses were at Sh14 billion compared to Sh13.9 billion in the previous year.

“We continue to optimize operating costs by leveraging on digital transformation,” Miano added.

Miano said the company would also continue implementing its Corporate Strategy to ensure sustainable power growth in the country, while leveraging on innovation and partnerships for continued business growth and
diversification.

“In the year ahead, we aim to deliver Olkaria I Unit 6 geothermal power plant, which will add 83.3MW to the national grid, and continue with our diversification strategy focusing on consultancies, operations and maintenance
services, training, and the operationalization of materials testing laboratory and electronic instruments calibration center,” the CEO said.

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