Unpacking The Kenya Power Billions: What Is Making Them Tick?

KEY POINTS
Cash and cash equivalents at the end of the year decreased by 64.2% y-o-y to KES 7.1 BN predominantly due to a 19.6% y-o-y drop in net cash generated from operations to KES 11.7 BN.
Kenya Power released its 1H25 results reporting a 30-fold (3025.4%) y-o-y increase in PAT to KES 9.9 BN. The improvement in profitability was primarily attributable to an 86.9% y-o-y decrease in finance costs to KES 2.0 BN coupled with a 14.0% y-o-y decrease in cost of sales to KES 71.4 BN.
Earnings Per Share for the period stands at KES 5.11 (KES 0.16 in 1H24). An Interim dividend per share of KES 0.20 was recommended, to be paid on or about 11th April 2025 to shareholders on the register as at close of business on 28th February 2025.
Revenue for the period contracted by 5.4% y-o-y to KES 107.4 BN characterized by lower passthrough costs and lower average yield as per the tariff reduction path embedded in the approved tariff.
Cost of sales (power purchase cost) went down by 14.0% y-o-y to KES 71.4 BN held down by reduced finance costs owing to a stable Kenya Shilling against major global currencies. The Company’s power purchase contracts are predominantly denominated in foreign currencies.
Read Also: Why Does Kenya Power Hate Its Customers Down To The Last Man?
Owing to the faster decline in revenues vis-à-vis costs of sales, gross profits advanced by 18.1% y-o-y to KES 36.0 BN; the gross profit margin came in at 33.6% compared to 26.9% recorded in 1H24.
Operating costs increased by 20.3% y-o-y to KES 23.7 BN underpinned by higher staff costs and maintenance costs.
Interest income stood at KES 361.0 MN compared to a finance cost of KES 2.0 BN in 1H25 largely due to the strengthening of the Kenya Shilling against major foreign currencies. The Company indicated that the USD and the Euro represent approx. 90% of its loan portfolio.
Total assets rose by 1.5% y-o-y to KES 368.6 BN while total liabilities decreased by 11.4% y-o-y to KES 271.3 BN. Total equity surged by 70.2% y-o-y to KES 97.3 BN.
Cash and cash equivalents at the end of the year decreased by 64.2% y-o-y to KES 7.1 BN predominantly due to a 19.6% y-o-y drop in net cash generated from operations to KES 11.7 BN.
On a trailing basis, Kenya Power is trading at a P/E multiple of 0.4x against a sector median of 2.7x and a P/B multiple of 0.2x against the sector median of 0.1x. Its ROA and ROE stand at 10.8% and 40.8% against sector medians of 4.9% and 22.1% respectively.
Read Also: Kenya Power Advances 9.7% To Hit Record High At The Bourse
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