Umeme Limited Reports 16.4% Revenue Growth in 2023; Profit After Tax Declines Due to Amortisation
- What caused the significant decline in the company's Profit After Tax in 2023?
- The significant decline in the company's Profit After Tax in 2023 was driven by accelerated amortisation of intangible assets.
Summary:
Operational Performance:
- The company went through a period of uncertainty due to high inflation and interest rates, and constrained supply chains.
- Electricity demand rose by 9.6% due to growth in customer grid connections and improved electricity supply reliability.
- 191,874 new customers were connected to the grid, an increase of 58% from the previous year.
- Investments were made to expand and reinforce the distribution network due to the increasing electricity demand and grid connections.
- Energy losses reduced to 16.2% due to enhanced field activities and new customer connections.
- Revenue collections averaged 99.0% in 2023 due to an improved bill payment culture and commercial cycle automation.
- Operating costs per KWh sold and operating cost per customer reduced due to efficient cost management.
Financial Performance:
- Revenue increased by 16.4% due to an increase in electricity demand and an increase in average tariff.
- Cost of sales increased by 15.5% due to the increase in the cost of electricity purchased.
- Gross profit increased due to an improved distribution margin and operational efficiencies.
- Operating costs increased by 5.8% due to general inflation and increased business operations.
- EBITDA increased due to the improved performance on gross margin and operating costs.
- Amortisation and impairment charge for the year increased significantly due to alignment of the amortization of underlying fixed assets.
- Profit after Tax reduced due to accelerated amortisation of intangible assets.
- Total assets as of 31 December 2023 were Ushs 2,347 billion compared to Ushs 2,571 billion in 2022.
- Company fully repaid the term interest-bearing debt in 2023.
Useful links
About Umeme Limited (UMEME.ug)
Umeme Limited supplies and distributes electricity in Uganda. It is the main electricity distribution company in the region; operating and maintaining a distribution network of some 31 790 kilometres of medium and low voltage electricity lines as well as providing after-sales services to its customers. Umeme Limited supplies electricity for domestic, commercial, industrial and public works usage, and is responsible for the purchase of electricity for Independent Power Producers. Umeme Limited is a subsidiary of Umeme Holdings; which is a subsidiary of Actis Infrastructure 2LP. Umeme Limited took over the supply and distribution of electricity in Uganda from UEDCL under a 20-year concession period. Umeme Limited is listed on the Uganda Securities Exchange
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