Kenya Electricity Jumps on Annual Profit Outlook: Nairobi Mover
Kenya Electricity Generating Co. (KEGC), the East African nation’s biggest power producer, rose to the highest in almost two weeks on speculation it will report increased full-year earnings.
The shares jumped as much as 4.2 percent and closed 0.6 percent up at 8:35 shillings in Nairobi, the highest since July 18, according to data compiled by Bloomberg.
“I think we will see strong full-year results because by the half year profit before tax was already up,” Aly Khan Satchu, chief executive officer of Nairobi-based investment company Rich Management Ltd., said in a phone interview today. “We had optimal rains so they have been able to increase the hydrology portion, which is cheaper to generate and reduced thermal generation, which is more costly.”
Net income for the six months ended Dec. 31 climbed 33 percent to 1.19 billion shillings ($14 million), the company said Feb. 28. “Above average rains” had improved reservoir levels, it said. KenGen began operating a third generating unit at the Kindaruma hydropower dam with 24 megawatts of capacity, it said June 26.
The fiscal year of KenGen ended June 30 and the company will probably announce its earnings within a month, a spokesman who declined to be named, said today by telephone.
KenGen’s future earnings will also be boosted by its investment in geo-thermal energy, Emma Mareri, an analyst at Nairobi-based African Alliance Kenya Securities Ltd., said in a phone interview today.
“Geothermal power is stable and they will not be affected by the risks in hydro-power generation,” Mareri said.
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