Karachi Electric (KE) profits have risen up to Rs. 32.75 billion at the end of financial year (FY) 2016, a net increase of Rs. 4.43 billion in one year.
Despite the hefty profits, KE board has decided to invest the profits into enhancing the company’s power generation, transmission, and distribution system.
According to a notice issued in Pakistan Stock Exchange (PSX), KE’s Board of Directors meeting was held on Wednesday to review the Company’s performance for the year ended 30 June 2016. As per their standard practice, KE issues its accounts after a one year delay.
In its financial results, KE declared profits of PKR 32.75 billion including deferred tax of Rs 7.95 billion during the period as compared to PKR 28.32 billion during the same period of FY 2015. The company’s earnings per share (EPS) increased to Rs. 1.19 per share as compared to Rs 1.03 in 2015.
CEO of KE, Mr. Tayyab Tareen briefed the Board of Directors about the company’s financial balance sheet, improvements in operations and other areas. Total sales of KE’s power units have also increased.
During FY 2016, KE sold 16545 GWh units compared to 1611 GWh during FY 2015. It shows a net increase of 434 GWh in one year.
“KE’s financial results have shown a sustained improvement over the years. KE’s transformation continues to be recognized as a success story of privatization and strengthens our position as a progressive power utility. The growth is a reflection of strong performance, sustained investments in KE systems and infrastructure. This all enhances fleet efficiency and services to customers. We are optimistic that we will continue to build infrastructure for enhancing our ability to serve our customers.” Tayyab Tareen said.
Tayyab Tareen said that the main reason for efficiency improvement is due to the reduction in transmission and distribution losses, which decreased to 22.2 percent in FY 2016 as compared to 23.7 percent in FY 2017, showing a reduction of 1.5.
The Board decided not to declare any dividend, and to reinvest the profit earned in the business. Capital expense of PKR 26 billion has been invested in generation, transmission, and distribution during the reporting period. The board emphasized the need for significant investment in reducing the supply and demand gap by adding more generation and enhancing the transmission and distribution network.
The Board further observed that a favorable result of Company’s review petition on Multi-Year Tariff (MYT) determination 2017, pending with NEPRA is critical for sustaining the transformation, efficient operations, and profitability of the Company.
The power utility remains fully committed to its vision statement of ‘Energizing Karachi’ while serving over 25 million people of Karachi and its adjoining areas.