Kengen has paid the government Sh1.15 billion as dividend for the financial year ended June 2019 with a promise of a higher pay during July’s shareholder meeting.
The Government owns 70 per cent stake at KenGen while 30 per cent is owned by private shareholders and will be key in approving a higher dividend payout in the July annual general meeting.
For the year ending June 2020, Kengen has proposed to reward its shareholders by increasing dividend per share to Sh0.3 up from 0.25 in 2019.
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This would increase the firm’s dividend pay to Sh1.9 billion after net profits jumped133 per cent to Sh18.3 billion on a Sh4.5 billion tax credit.
Despite the disruptions of the coronavirus pandemic, the company managed to push up for the year ending June 2020 on the large tax saving and cheaper electricity sales following the completion of Olkaria V geothermal power plant.
“If approved at the AGM, the dividend will be paid less withholding tax where applicable on or about Thursday 22, July 2021 to the shareholders,” Kengen CEO Rebecca Miano said.
Ms Miano said Kengen recorded a 13.4 per cent growth in electricity revenue mainly attributed to the full operationalization of its 165 megawatts of Olkaria V geothermal power plant in November 2019 which boosted geothermal production by 14 per cent.
Completion of the plant helped the company cut reliance on thermal generators saving on costs while dispatching cheaper geothermal power which boosted electricity sales 11.3per cent to Sh39.8 billion.
Reimbursable expenses from use of thermal plants declined 57.9 per cent from Sh10.1 billion to Sh4.2 billion cutting the costs for the company in the year that witnessed demand challenges over coronavirus lockdowns on businesses and industry.
Mrs. Miano said KenGen’s diversification strategy was bearing fruit as the organization had been able to incorporate new business lines in its revenue streams including consultancy services.
The company is currently offering geothermal drilling services and undertaking geoscientific studies in Kenya and Ethiopia.
The firm also attributed the growth to the roll-out of the company’s business diversification strategy netting Sh440 million from its two drilling contracts in Ethiopia.