Kenya Electricity Generating Company (KenGen) has reported a marginal decline in net profit for the financial year ended June 2026, as a sharp reduction in finance income offset revenue growth from higher electricity sales.

Profit after tax reduced by 1.2 per cent to KSh10.35 billion from KSh10.48 billion reported in the previous year according to results published on Monday. 

The decline, though modest, signals the financial impact of the company’s capital investment programme, which has drawn down cash reserves that previously generated significant interest income.

During the year, revenue increased by 6.4 per cent to KSh59.7 billion, up from KSh56.1 billion, supported by record electricity demand in the country. 

Data shows that Kenya’s peak power consumption reached an all-time high of 2,549 MW during the year attributable to broader economic expansion as gross domestic product increased by 5.3 per cent, up from 4.9 per cent in 2025. 

KenGen's operating profit increased to KSh14.2 billion from KSh13.6 billion underscoring the strength of the company’s core generation business.

Pressure on earnings

The company's pressure on earnings came from below the operating line. Finance income fell by 29 per cent to Sh2.9 billion from KSh4.1 billion as the firm deployed cash resources into capital investments to expand its capacity to generate energy. 

Finance costs, however, provided some relief during the period under focus as they fell by 12.1 per cent to KSh2.0 billion owing to the company’s push to reduce its debt burden. 

Total borrowings declined by KSh12.2 billion to KSh97.1 billion, enhancing financial flexibility and reducing interest expenses. 

KenGen supplied 8,975 GWh of electricity to the national grid during the year, representing 57.2 per cent of Kenya’s total electricity supply. More than 90 per cent of this came from renewable sources, that is, geothermal, hydro, wind and solar, underscoring the company’s position as key player in the country’s clean-energy transition.

“Record electricity demand is a powerful signal of a growing and increasingly connected economy,” KenGen Managing Director and CEO Eng. Njenga said. “Our responsibility is to stay ahead of that growth by delivering reliable, sustainable and competitively generated electricity. By expanding renewable capacity and strengthening system resilience, we are helping protect consumers from the volatility associated with fossil-fuel generation while creating the energy foundation for Kenya’s industrial transformation.”

The company said it is now accelerating investments under a revised long-term strategy. It recently raised its renewable energy development pipeline to 5,540 MW by 2034, a significant increase from an earlier target of 1,500 MW. 

Near-term projects include the 63 MW Olkaria I geothermal plant rehabilitation, the 42.5 MW Seven Forks solar project, the Gogo hydropower upgrade and battery storage solutions.

Dividend payout

The lower net earnings prompted KenGen’s board to reduce the final dividend to 75 cents per share, down 16.7 per cent from 90 cents paid in the previous year. 

KenGen’s share price, however, has remained resilient. The stock has rallied on the Nairobi Securities Exchange, reflecting investor confidence in the company’s long-term growth prospects despite near-term earnings pressure.

KenGen’s management noted that the decline in finance income is a consequence of strategic capital deployment rather than operational weakness. The company’s core business, which is generation of electricity, remains strong, supported by rising demand and an increasingly renewable-heavy portfolio.

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