The Karachi Electric Supply Company losses in the six months ended on December 31, 2003, narrowed down to Rs 3.761 billion after rise in energy sales and cut in financial costs.
The KESC losses moved down to Rs 3.761 billion as compared with Rs 6.478 billion of the same period a year ago, the company said in a notice issued to the Karachi Stock Exchange Monday.
The net energy sale during the period rose by 13.7 percent to Rs 18.793 billion as against Rs 16.519 billion of the same period a year go. The drop in financial charges also helped the company to curtail its losses.
The financial expenses moved down to Rs 464 million as compared with Rs 896 million of the same period a year ago.
The government plans to sell as much as 73 percent shares of the KESC during the current calendar year and has received four expressions of interest from overseas buyers to buy stake in the state-controlled electricity producer.
KESC has made a remarkable improvement of 42.6 percent in its financial position by reducing its losses from Rs 6.4 billion in July-December 2002 to Rs 3.6 billion during the same period of 2003-04 fiscal year, KESC spokesman said here on Monday.
He said that during July-Dec, 2003, the Corporation had initiated the system improvement plan, which helped in reduction of Transmission and Distribution (T&D) losses from 39.2 percent to 38.1 percent (one percent of T&D loss in financial terms is equal to Rs 500 million per annum).
Besides, all performance indicators are showing overall improvement in the financial and operational activities of the corporation compared to the previous year, he added.
The recovery policies and relief packages for electricity consumers by KESC management and constant monitoring of the defaulters by Army Monitoring Teams had helped the Corporation in increasing its revenue from Rs 16.8 billion to Rs 19.1 billion, an additional earning of 13.8 percent during the first six months of the current financial year.
The significant decrease of Rs 2.726 billion in the financial losses of July-December 2003 were due to increase of KESC's own generation by 12.4 percent reduction in T&D losses and decreasing the financial charges from Rs 953 million to Rs 532 million, an improvement of Rs 421 million.
The increase in the KESC's own power generation helped the corporation minimise the costly power purchase from Wapda/IPPs to meet the city power demand.
The improvement in the current financial position has helped the KESC in reducing the loss per share from 74 to 43 paisa per share.
The corporation through austere and stringent financial control was able to achieve the turnaround on its losses while adding a nominal increase of 3 percent on its O&M expenses during the period under review.
The first six months' operational and financial activities of KESC were encouraging and indicative that the power utility with a similar resilience during the remaining period of the fiscal 2003-04 would close its annual accounts at a laudable pace towards profitability, the KESC spokesman added.
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