Uganda’s Umeme Limited profit after tax remained unchanged during the first-half of 2024 at USh13 billion, as the company prepares to re-transfer assets back to Government at the end of the 20-year concession due to terminate naturally on 30th March 2025.
- According to the company, the profit remained at the same level due to accelerated amortization of intangible assets.
- Finance costs reduced by 36.2 per cent to USh16 billion following repayment of all term loans in December 2023, and management of working capital during the period.
- Income tax charge for the period increased to USh11 billion compared to USh3.5 billion in 2023. The increase is due to performance on profit before tax for the period.
“As the concession is coming to the end of its natural term in 2025, the International Financial Reporting Standards (IFRS) require alignment of asset amortization to the remaining period of the contract term,” said Selestino Babungi Managing Director, Umeme Limited.
Consequently, the amortization charge for the period increased to USh238 billion compared to USh210 billion for 2023.
Total assets as of 30 June 2024 were USh2,243 billion compared to USh2,347 billion at 31 December 2023. The decrease in total assets is mainly due to increased amortisation of intangible assets and reduction in capital investments during the period.
Shareholder Equity reduced by 14.4 per cent, to USh803 billion as at 30 June 2024, due to low profit after tax for the period and dividends paid or declared in the period.
The company’s net operating cashflow reduced to USh112 billion compared to USh221 billion in 2023 due to reduction in payables and lag in receipt of amounts due from Government.
“We are currently in the last 3 quarters of the Concession. Umeme and the Government are engaged for a smooth re-transfer of distribution assets at the end of the Concession in 2025. The Company remains committed to a seamless assets retransfer process, as detailed in the Concession Agreements, while protecting the interests of customers, staff and shareholders,” noted Patrick Bitature, Chairman of Umeme Limited.
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