Business
Uganda electricity distributor, Umeme, launches regional IPO
Kenya Power last week announced it will increase the fuel cost and forex components of electricity charges beginning this month.
Umeme recently released its 2011 annual report, which reflected a 45 percent growth in Earnings Before Interest Taxation Depreciation & Amortization (EBITDA) before exchange rate differences of Ush103.6 billion (US$40.4 million), up from Ush71.2 billion (US$27.8 million) in 2010.
Profits before tax grew from Ush6.4 billion (US$2.49 million) in 2010 to Ush44.6 billion (US$17.4 million) in 2011. Umeme has had its fair share of challenges incurring losses due to both power interruptions as a result of illegal power use and repairing damaged transformers.
In 2011 alone, the power distributor lost 28 percent of its annual revenue to power theft such as meter tampering, meter bypass, meter miss-read and illegal connections.
Electricity distributors in the region such as Umeme, Tanesco and Kenya Power have been transforming their businesses to focus on certain lines.
Kenya has split the power sector where different companies perform specific roles in the electricity supply chain. Kengen, which is listed at the Nairobi Securities Exchange, generates power either hydro or wind power or geothermal.
