By James Anyanzwa

The Kenya Power and Lighting Company Ltd has posted a 75 per cent growth in pre-tax profits for the full year period ended June 30, 2009.

The power distributor’s profits before tax (PBT) grew to Sh4.8 billion from Sh2.7 billion in the previous year.

Electricity revenues increased by 52.4 per cent to Sh36.4 billion from Sh23.9 billion mainly due to the tariff increase effected from July 2008, gains from reduced system losses and enhanced operating efficiency.

Eng Joseph Njoroge, the company’s Managing Director and Chief Executive attributed the impressive performance to heavy investment made during the year to improve the quality of power supply to the economy and to facilitate accelerated connection to new customers.

Fuel cost recoveries, however, increased 72 per cent to Sh28.2 billion from Sh16.4 billion mainly as a result of drought, which prompted scaling down of hydro generation in favour of thermal generation.

"The increase was attributable to high fuel prices in the international market during the first quarter of the year and the increased amount of fuel used to generate power," Njoroge told a media briefing in Nairobi on Thursday.

The fuel revenue, which is recovered from customers, is a pass-through cost paid directly to thermal-based bulk power suppliers, and does not constitute an income to KPLC.

The non-fuel power purchase costs increased by Sh6.8 billion to Sh18.7 billion, up from Sh11.9 billion, as a result of the implementation of the new power purchase agreements with KenGen and other generators during the period under review.

Njoroge said the company would continue investing in programmes that ensure adequate power supply to customers.

In the last three years, KPLC invested heavily in power system upgrade and reinforcement, in order to improve the quality of power and increase the customer base.

The net increase in fixed assets by 28 per cent, from Sh39 billion to Sh50 billion, is attributable to this investment, which was financed through local and foreign loans as well as internally generated funds.

The board of directors recommended a total dividend payout of Sh8 per share, subject to shareholders approval in the forthcoming annual general meeting(AGM)