Karachi Electric Reports First Profit Since 2005 Government Sale
Karachi Electric Supply Corp., (KESC) the supplier of power to Pakistan’s biggest city, reported a full- year profit for the first time in seven years after the company reduced line losses and power theft.
Net profit was 2.62 billion rupees ($27.8 million) or 0.11 rupees a share, for the 12 months ended June 30. It compares with a loss of 9.39 billion rupees, or 0.44 rupees a share, in 2011, the company said today in a filing.
Profitability will allow Karachi Electric to replace outdated meters and defunct transformers that have contributed to losses in revenue. The utility is cutting costs and adding generation plants to help reduce outages that led to street protests by residents of the city last year.
“They made an effort to reduce their cost,” said Faisal Khan, a research analyst with Arif Habib Ltd. (AHL) “Curbing the electricity theft and lining up their tariffs according to the fuel cost were the main areas where the results helped their net profit.”
It’s the first time Karachi Electric has turned a full-year profit since the company went private in 2005.
The company’s shares had risen 14 percent to 4.21 rupees as of 11:51 a.m., the highest since May 3, in volumes more than six times the three-month average.
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