Utility Kenya Power has announced a KES24.47 billion net profit for the fiscal year ending June 2025, down 18 percent from KES30.8 billion recorded a year ago attributable to lower tariff yields and a stronger shilling, with a proposed dividend of KES0.80 per share.

Kenya Power said the impact of foreign exchange rates across 2024 in comparison to 2023 caused lower revenues but also saw the firm experience higher financing costs as unrealized forex gains reversed on impact of a strong shilling.

Since late last year, the Kenyan Shilling has demonstrated remarkable stability against major currencies including the US dollar where it has traded on average between 128 and 130 units. Across 2023, the Kenyan shilling experienced huge depreciation due to market uncertainties.

In a note to the market on Monday, Kenya Power said its revenue during the year eased by 5.1 percent to KES219.29 billion even as its operating cost of sales decreased by 3.9 percent to KES144.7 billion.

Forex recoveries

"This decline [revenue] was mainly due to reduced foreign exchange recoveries following the sustained stability of the Kenya Shilling and the application of a lower base tariff aligned to the approved tariff reduction path," the company stated in part.

What's more, finance costs went up to KES4.72 billion compared to KES683 million reported in FY2023/24 "mainly due to the reversal of unrealized forex gains. Specifically, exchange gains on loan revaluations of KES7.89 billion recorded in the prior year reversed to an exchange loss of KES784 million in the year under review, reflecting the impact of a strong currency." 

Utility said that during the year, electricity purchases increased by 787GWh due to rising demand even as the efficiency of power transmission went up to 78.79 percent from 76.84 percent previously attributable to ongoing upgrade of grid systems and loss reduction measures.

"New peak demand levels were achieved during the period, highlighting network resilience, although temporary supply constraints led to isolated load shedding during peak hours," the firm said.

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