KARACHI: The net profit of K-Electric recorded a decline of 28.9 per cent to reach Rs8.52 billion during the fiscal year 2022, compared with a net profit of Rs11.99 billion during the fiscal year 2021.
The earnings per share (EPS) of the company remained Rs0.31/share in the fiscal year 2022, compared with the EPS of Rs0.43/share in fiscal year 2021.
Driven by prudent policies, the company’s key areas of operations showed strength. Transmission and distribution losses further reduced to 15.3 per cent in the fiscal year 2022 from 17.5 per cent. This improved performance was partly set off due to the negative impact on account of the mid-term review (MTR) decision.
K-Electric Chief Executive Officer Moonis Alvi said the previous fiscal year brought some unique challenges and put the power sector to test.
“Our company-wide focus on embedding digitalisation and automation into our core business processes enabled K-Electric to maintain its agility and sustain its commitment to the people and Karachi,” he added.
“Continued investment has demonstrated improved network stability during an unprecedented monsoon season, and we have also reduced our network losses to deliver safe, secure, reliable and uninterrupted power,” Alvi said.
It is critical that the government and associated stakeholders address legacy issues which can help the company actualise its potential and make a lasting impact in Pakistan’s economic and industrial hub, while also contributing positively to the transformation of the power sector, he remarked.
The Company’s gross profit increased 22 per cent as compared to last year, driven by the operational improvements.
However, increase in consumer tariff and current economic conditions impacting consumers’ propensity to pay lead to increase in impairment loss, substantial rupee depreciation in the international currency market resulted in exchange loss and increase in policy interest rates translated to increase in finance cost.
During the first half of fiscal year 2022, the economy recovered from the adverse socio-economic impacts of the Covid-19 pandemic with economic activity carrying momentum from the last year and witnessed a GDP growth of 5.97 per cent during the fiscal year 2022, as reported by the Pakistan Economic Survey 2021/22.
The last quarter of fiscal year 2022, however, in particular, saw material socio-political challenges, both locally and on the international front, having a consequential impact on the macroeconomic factors.
Despite the challenges faced by the utility, investments of approximately Rs62.8 billion were channeled across the value chain of the electric power utility during the year including various initiatives to increase system reliability and meet the city’s growing power demand.
The Black Start capability was successfully commissioned at Korangi Combined Cycle Power Plant (KCCP), thus enhancing K-Electric’s technical ability in contingency situations and reducing reliance on the Independent Power Producers.
Further, the company continued to invest in overhauling activities at its existing generating plants resulting in improved fleet efficiency and reliability.
During the year, K-Electric expedited the process of setting up new grids and interconnection works which would enable drawl of additional power from the national grid besides the 1,100MW currently being evacuated.
In this regard, the process for setting up a new grid at 500kV level is on the fast track. The construction of the new 220 kV Dhabeji Interconnection is also in full swing.
Upon the completion of these grids and interconnection works, K-Electric will be able to import additional power from the national grid taking the total drawl to 2,050MW, which will enable K-Electric to better manage the demand in the upcoming years alongside enhancing system reliability.
On the distribution front, the company has continued to make headways across various distribution projects. It is important to note that K-Electric achieved all its goals as budgeted and beyond for commercial and technical targets.
This included lowering distribution loss and outages and improving recovery, SAIDI, and SAIFI.
During the fiscal year 2022, over 300,000kg of illegal hooks (Kunda) have been removed from the system and around 244,000 new meters installed through low-cost meter scheme. As of the end of year, a total of 12,500 Pole Mounted Transformers (PMT) have been converted to Aerial Bundled Cables (ABC).
Additionally, with a focus on customer centricity and to enhance customer facilitation, the company has expanded its Customer Facilitation Centre (CFC) to eighteen locations citywide.
