Kenya Power & Lighting Company Plc · NSEKE:KPLC
Kenya Power & Lighting — FY2020 Earnings Presentation
32 slides from Kenya Power & Lighting's earnings presentation, Jun 30, 2020
Slide 1: Kenya Power Trading Performance FY June 2020 and HY December 2020
Kenya Power TRADING PERFORMANCE YEAR ENDED 30TH JUNE 2020 AND HALF YEAR ENDED 31ST DECEMBER 2020. Presentation by Bernard Ngugi, Managing Director and CEO
Slide 2: Contents
Contents 01 OUR MANDATE 02 BUSINESS ENVIRONMENT 03 BUSINESS REVIEW 04 STRATEGIC OUTLOOK 05 FINANCIAL REVIEW
Slide 3: Our Mandate
Part 01 Our Mandate
Slide 4: Purchasing bulk electricity supply (Single Buyer)
Purchasing Building and Retail of Customer bulk electricity maintaining a electricity Service supply (Single Buyer) robust power network
Slide 5: Business Environment
Part 02 Business Environment
Slide 6: Global Economy
Business Environment Global The country’s economic growth experienced downside risks as a Economy result of protracted global recession undermining Kenya’s export, tourism and remittance inflows, further tightening of COVID-19 health response measures disrupted the domestic economic Contracted by 4.
Slide 7: COVID-19 Impact
COVID-19 Impact ❖ The country movement restrictions saw widespread business closure hugely affecting electricity sales growth. ❖ The COVID-19 pandemic had an impact on the company’s performance, the business areas affected were; • Electricity sales declined by 14.8% in the last quarter • Increase in
Slide 8: Business Review
Part 03 Business Review iK= | ower
Slide 9: Performance Highlights
Performance Highlights Increased Revenue Increased Capacity Basic electricity revenue grew from Kshs 133,141 Generation capacity grew to 2,647MW compared to million to Kshs 133,259 million, a 0.09% growth. 2,510MW in FY 19 Electricity Demand Forex Electricity demand dropped by 0.04% from 8,174 Incre
Slide 10: Generation Mix
Net imports Others 2% 1% Wind Generation Mix Thermal 11% 7% Geothermal 47% • A diversified generation Hydro capacity mix with over 90 per 32% cent green energy. Geothermal Hydro Thermal Wind Net imports Others
Slide 11: Financial Review
Part 05 Financial Review Presentation by Ag. General Manager, Finance
Slide 12: Performance Highlights FY 30th June 2020
2020 2019 CHANGE Performance Highlights FY 30th Shs’000 Shs’000 June 2020 Electricity Sales 116,172,484 112,429,184 Total Revenue 133,258,602 133,140,887 Basic Power Purchase 74,445,008 70,878,036 Costs Operating Profit 5,312,226 10,530,956 (Loss) / Profit Before Tax (7,042,014) 333,614 Capital Expe
Slide 13: Electricity Sales
Electricity Sales 2020 2019 Shs’000 Shs’000 Electricity sales 116,172,484 112,429,184 • The electricity revenue largely remained unchanged due to the Foreign exchange adjustment 923,648 859,690 COVID -19. Fuel cost charge 16,162,470 19,852,013 • Delay in tariff review allocation. Revenue from contra
Slide 14: Power Purchase Costs
Power Purchase Costs 2020 2019 ❑ New generation - Shs’000 Shs’000 Commissioning of Olkaria V 158MW Non-fuel costs 74,445,008 70,878,036 ❑ Energy mix - Improved Foreign exchange costs 1,993,882 985,704 ❑ Foreign exchange - Fuel costs 11,060,502 18,288,556 depreciation of the Shilling 87,499,392 90,15
Slide 15: Power Purchase Trends
Power Purchase Trends Power Purchase Costs 100 90 Total PPC 80 Non-fuel costs 70 60 50 40 30 20 10 Fuel costs 0 Forex costs 2017 2018 2019 2020 Non-fuel costs Fuel costs Forex cost Total PPC
Slide 16: Transmission & Distribution Costs
Transmission & Distribution Costs 2020 2019 ❑ Depreciation – Increased Shs’000 Shs’000 asset base of the company Depreciation 16,335,890 15,896,918 ❑ Staff Cost- Enactment of the CBA Staff Costs 17,490,847 16,098,925 ❑ Electricity Receivables- Provision for electricity debtors 3,157,789 1,264,412 Co
Slide 17: Finance Costs
Finance Costs ❑ Company met all its Dec 2020 Dec 2019 commercial loan repayment obligations Shs’000 Shs’000 Interest incurred 7,985,344 8,209,609 ❑ Depreciation of the Shs from 102/1USD in June 2019 to Unrealised foreign over 106/1USD in June 3,531,264 1,001,441 exchange gain/(loss) 2020 11,516,608
Slide 18: Financial Position
Financial Position Financial Position Millions 350 ❑ Capital asset base 300 325 decreased by 0.91% 250 from Kshs 328, 004 328 270 million to Kshs 325,060 200 272 million YoY 150 100 56 50 55 - Total Assets Total Equity Total Liabilities 2018/19 2019/20
Slide 19: Half Year 2020/2021 Financial Overview
HALF YEAR 2020/2021 Financial Overview
Slide 20: Performance Highlights HY 31 Dec 2020
PERFORMANCE Dec 2020 Dec 2019 CHANGE HIGHLIGHTS HY 31 Shs’000 Shs’000 DEC 2020 Electricity Sales 61,497,156 61,241,134 Foreign Exchange 2,662,375 571,532 adjustment Fuel cost adjustment 4,855,056 7,793,993 Revenue 69,014,587 69,606,659 Power Purchase Costs 45,578,130 45,515,771 Operating Profit 8,32
Slide 21: Revenue
Revenue FIGURES IN KSH. MILLION Dec 2020 Dec 2019 • Domestic customers registered the highest growth in terms of unit Electricity Sales* 61,497,156 61,241,134 sales at 5.63%. Foreign Exchange adjustment 2,662,375 571,532 • The small commercial, commercial and industrial cadres Fuel cost adjustment 4
Slide 22: Power Purchase Cost
Power Purchase Cost Dec 2020 Dec 2019 ❑ Depreciation of Kenya Shilling Shs’000 Shs’000 affected Non fuel & Forex Payments Non-fuel costs 38,122,496 37,190,151 ❑ Reduction in units purchased Foreign exchange costs 2,837,388 1,173,124 from thermal plants by 129 GWh from 524 GWh the previous year Fuel
Slide 23: Transmission & Distribution costs
Transmission & Distribution costs Dec 2020 Dec 2019 ❑ Capital asset base expansion Shs’000 Shs’000 ❑ last phase of the collective Depreciation 8,597,012 8,230,578 bargaining agreement for the years 2017 to 2020 Staff Costs 8,574,251 8,434,626 Other Operating Costs 1,504,118 6,312,254 Total T & D Cos
Slide 24: Finance Costs
Finance Costs Dec 2020 Dec 2019 Shs’000 Shs’000 ❑ More payment of loans. Interest incurred 3,331,694 4,628,758 ❑ Depreciation of Kenya Unrealised foreign exchange Shilling 4,725,570 (793,910) gain/(loss) 17,171,263 16,665,204 Total T & D Costs 18,675,381 22,977,458
Slide 25: Strategic Outlook
Part 04 Strategic Outlook
Slide 26: Strategic Priority Areas
Strategic Priority Areas ENHANCING REVENUE INCREASE SALES IMPROVE SYSTEM IMPROVING CUSTOMER COLLECTION EFFICIENCY EXPERIENCE .
Slide 27: Enhancing Revenue Collection
Enhancing Revenue Collection ▪ Deployment of extra ▪ Team was mandated to follow up workforce drawn from office- on outstanding customer payments based staff countywide to ▪ Identify and address billing enhance our field presence. ▪ County Business heads structure inconsistencies on flagged ▪ A tota
Slide 28: Increase Sales
Increase Sales ❖ Increase in our customer base to 7,576,145 in line with our sales strategy. ❖ To enhance reliability in 11kV and 33 kV, the Company acquired thermo vision cameras. ❖ With the Live-Line teams operational, there has been a reduction in the unserved energy by deploying 31 teams on LV l
Slide 29: System Losses Reduction
System Losses Reduction ❖ Feeder Metering Project. A total 1,184 feeders have been metered to enable the determination of the amount of electricity units ❖ Boarder meters: 67 points have been covered under the boarder metering ❖ Metering of Distribution Transformers: To enable KPLC zero-in on loss a
Slide 30: Cost Management
Cost Management Power Purchase Capital Transmission and Financing Cost Costs Expenditure Distribution • Refinance our short-term • Rescheduling and • Optimising internal debt to term loans to improve • Limiting CAPEX review of PPAs resources to cashflow pressures. to critical manage staff costs, mai
Slide 31: Customer Centricity
Customer Centricity 01 02 03 04 Improving our Customer Enhancing Reliability of Improving Service Delivery Self Service Modules Touch Points Customer Service at the County Level Systems 50 additional employees to Network Operations • The new county Deployed a new telephone provide capacity for the C
Slide 32: Thank You.
Thank You. TUNZA CUSTOMER Kenya Power
Kenya Power & Lighting Company — FY2020 Earnings Presentation on 6ix