Reduction in Tax Lifts KenGen's Net Earnings by 133% to KSh 18.38 Billion

Kenya Electricity Generating Company PLC (KenGen), a state-owned electricity generating firm, has posted a Net Profit of KSh18.38Billion, at the close of the financial year ended 30th June 2020. This is compared to KSh 7.88 Billion over the previous financial year.

KenGen’s profit drivers

The firm attributes the sterling financial performance to a KSh 8.1 billion reduction in corporate tax rate from 30% to 25% as per the Government’s relief measures to support companies navigate through the COVID-19 crisis.

“We appreciate the support that the state provided during this unprecedented time to enable us to continue providing electricity as an essential service,” said Mrs Rebecca Miano. CEO KenGen.

KenGen was also able to ride on favourable hydrological conditions that led to dams operating at full throttle.

Despite a fall in hydropower production by 2% following lower demand associated with the pandemic effects on power consumption, firms operate on night shifts.

Outlook

In its outlook, the firm plans to deliver Olkaria I Unit 6 geothermal power plant, which will add 83.3MW to the national grid, and continue with its diversification strategy focusing on consultancies, operations and maintenance services, training, and the operationalization of materials testing laboratory and electronic instruments calibration centre.

Kenya Electricity Generating Company PLC posted a KSh 13.9 Billion pre-tax profit for the year ended 30th June 2020. Compared to a pre-tax profit of KSh 11.6 Billion the prior year, an increase of 8.3%.

The firm’s profits were boosted by revenues from the 165MW Olkaria V geothermal power plant and earnings from geothermal drilling activities in Ethiopia.

“We reported a 13.4% 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%,” said Mrs Miano.