Umeme Limited (UMME) has announced a net profit of $ 38.9 million (Ushs 148 billion) for the financial year that ended on December 31st 2022, 6.47 per cent increase from $ 36.8 million (Ushs 139 billion) recorded last year.
The performance was characterized by negative changes in the macro-economic environment, increased demand for electricity supply following the lifting of Covid-19 restrictions, inflation, increase in interest rates, continued supply chain disruptions, and effects of global geopolitical conflicts.
However, the electricity sector was resilient during the year, with an average growth in electricity demand of 9.7% across all customer categories.
Umeme Limited Operational Performance
Umeme Limited customer base increased by 7.4% and recorded an increase in customer funded applications due to the reduction of connection capital costs by the Government.
Energy losses decreased to 16.8% from 17.8% in 2021, and this was due to the re-opening of the economy and the adoption of more decentralized operating procedures that allowed for community participation.
Additionally, revenue collection rate increased to 99.7%, improved efficiency, reducing operating costs per KWh sold and per customer by 7.6% and 5.6%, respectively.
However, Umeme Limited unfortunately recorded eleven fatalities arising from network interference, power theft and illegal operations by unauthorized people, and urged the public to report any unsafe networks, power theft, vandalism or unauthorized network operations.
Financial Performance
Revenue marginally increased to $ 450 million in 2022, driven by an increase in electricity demand, reduction in energy losses, new connections, pricing, and revenues from electricity distribution construction services.
However, the gross profit reduced by 1.5% to $ 167.7 million due to a reduction in capital expenditure and performance on energy losses.
The operating costs increased by 3% to $ 65 million, but operating efficiencies improved due to restructuring and insourcing of network operation activities. EBITDA reduced to $ 102 million due to gross margin and operating costs.
Finance costs increased, but foreign exchange gains amounted to $ 3.7 million. Income tax charge for the year amounted to $ 17.7 million. Total assets marginally increased, and shareholder equity increased by 13.1%.
The net operating cash flow for the year was $ 92.7 million, and capital investments implemented in the year was $ 29.4 million.
The Board of Directors recommends a final dividend of $ 0.017 (Ushs 63.9) per ordinary share for the year ended 31 December 2022, subject to approval at the Annual General Meeting on 18th May 2023.
The dividend will be paid on or about 20th July 2023 to shareholders registered as of 30th June 2023, and is subject to withholding tax.
Umeme Limited 2023 Outlook
We remain committed to executing our mandate of electricity distribution through to the end of the Concession. We hereby extend our re-assurance to the Government, stakeholders and our shareholders of our commitment to a smooth transition process back to Government operation of the distribution system, while continuing to meet our contractual obligations, and expectations of our shareholders. We extend our gratitude to all stakeholders, business partners and shareholders for the continued support to Umeme. We count on this continued support to further deliver shared value to customers, the Government, staff, and the communities we
Umeme Limited
serve.
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