Kenya Power has issued a profit warning for the financial period ending June 30, 2019, attributable to increase in non-fuel costs.
Last year, the company issued a profit warning before posting a 63.7 per cent drop in net profit to Ksh1.92 billion due to escalated operational costs.
“We wish to inform shareholders and the general public that the company’s net profit for the financial year ended June 30, 2019, are projected to decline by more than 25 per cent of the net earnings reported last year,” Kenya Power acting MD Jared Otieno said.
Otieno also promised that the cost of energy to consumers will be reduced and ensure long term profitability for the firm.
The company has been battling corruption allegations that saw former managing director Ken Tarus ousted over a Ksh409 million scandal.
Also, in the last financial year, the Kenya Electricity Generating Company (KenGen) was demanding Ksh1 billion in penalties for flouting the 40-day window credit terms.
In June, the Directorate of Criminal Investigations (DCI) summoned 204 individuals and directors of certain companies to record statements concerning fraudulent Kenya Power billing system for post-paid customers.
According to the DCI, the individuals are thought to be involved or having knowledge of a conspiracy in a multi-million scandal where Kenya power officials were involved.
The scandal involved over 5,000 customers, who benefited from the fraudulent deal.
“The DCI is currently investigating allegations of fraud involving millions of shillings in Kenya Power in regards to billing system (postpaid); the funds were lost as a result of conspiracy between some Kenya Power staff, brokers and some Kenya Power customers where over 5,000 customers benefited,” read the notice from DCI in part.