K-Electric's profit after tax showed an increase of 119 per cent during the last fiscal year (FY15) mainly due to a reduction in line losses. The power utility earned Rs 28.325 billion profit during the FY15 compared with Rs 12.88bn in FY14, indicating an increase of Rs 15 billion. However, company's revenue witnessed a declining trend as it fell by 2pc to Rs 190 billion for the year FY15 as against FY14's Rs 194 billion.
Attributing the reasons behind financial improvement to reduction in its transmission and distribution (T&D) losses, KE said that T&D losses decreased to 23.7pc as compared to 25.3pc in FY14, thereby showing a reduction of 1.6pc. The power utility was suffering Rs 14.64 billion losses in FY 2010. This was, however, reduced to 9.3bn in FY 2011. The company turned into profit-making entity in FY 2012 by posting Rs 1.8bn profit since its privatisation. The company's profit margin went up to Rs 6.82bn in 2013.
The KE's annual financial reports showed that it had generated around 7.964 million gross units in FY-2010 whereas in FY-2011 it generated 7.826m units. The company's gross generation in FY 12, 13 and 14 stood at 8.0, 8.567, and 8.70m power units, respectively.
The power utility continued to purchase additional electricity from external sources as in FY 2005 it bought 4.289m units. The figure of total power purchase went up to almost double or 7.4m in 2015. The company purchased some 5.370, 6.708, 6.527, 7.005, 7.842, 7.605, 7.230, 7.257, and 7.28m units from FY2006 to FY 2014, respectively.
The report pointed out that the federal government has curtailed the amount of tariff adjustments/subsidy to KE this year. The government provided some Rs 53.2bn to the power utility in FY 2014; however the same was reduced by 43.7bn in FY15, prompting the KE to increase the residential tariff by 30pc, the report added. It further stated that receivables from public sector consumers, mainly Karachi Water and Sewerage Board (KWSB) and City District Government Karachi (CDGK) rose to Rs 38.3bn and Rs 8.3bn, respectively, creating liquidity issues for the company.
In addition, an amount of Rs 35.6bn (net of tariff adjustments) was receivable from government of Pakistan on account of tariff differential claims, it added. The company said that it has heavily invested and upgraded its transmission and distribution network, rehabilitated its old plants that it acquired, and gained additional MWs of electricity for improving efficiency.
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