Genghis Capital - Kenya Power Lighting Co. Ltd (KPLC) Kenya Power Lighting Company Ltd (NSE: KPLC) 1H19 Earnings Note

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Genghis Capital

Gerald Muriuki

EUR 30.00 For Business Accounts Only

Kenya Power & Lighting Company Ltd (NSE: KPLC) 1H19 Earnings Note

Kenya Power Ltd (NSE: KPLC) announced a negative growth of 16.7% y/y in 1H19 EPS to KES 1.25 despite a strong y/y growth in electricity sales (21.4%). Other key revenue lines; Forex adjustment and fuel costs recovered, declined 82.0% y/y and 34.0% y/y respectively, driving total revenue to grow by a marginal 3.4% y/y. Cost management remains a formidable challenge with transmission costs rising 37.3% y/y. This is majorly on account of 100.0% y/y increase in provisions (KES 2.46Bn) and accelerated depreciation costs (+16.4% y/y). Additionally, finance costs grew 23.5% y/y. The current fundamental challenges noted in this note together with concerns raised by the Auditor General with regards to F18 results, form our basis of a SPECULATIVE BUY recommendation

25/02/2019 5 EN

Underlying

Kenya Power & Lighting Co. Ltd

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KE0000000349 Nairobi Securities Exchange Kenya

Provider

Genghis Capital

Genghis Capital is an innovative and customer focused Investment Bank licensed by the Capital Markets Authority (CMA). Founded in 2008, Genghis is one of the leading investment banks in Kenya. Since its establishment, Genghis has achieved tremendous growth to offer a well-diversified portfolio of financial services that includes:

i. Securities(Equity/Debt) Trading
ii. Research
iii. Wealth Management services
iv. Investment Advisory & Management via the GenCap Unit Trusts
v. Corporate Finance & Transaction Advisory services

The Kenyan Capital Markets continue to develop in size, scope and sophistication. With this is an increasing demand for more specialized and personalized brokerage service and we at Genghis Capital are glad to be able to offer you this service. Our strength lies in ensuring our clients are up to speed with developments at the stock market and the economy. Research and technology remains our competitive and comparative advantage hence Experience, Expertise and Professionalism are some of the qualities you can expect from our team.

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Analysts

Gerald Muriuki

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Kenya Power & Lighting Company Ltd (NSE: KPLC) 1H19 Earnings Note

Kenya Power & Lighting Company Plc (NSE: KPLC) FY19 Earnings Note

Kenya Power and Lighting Company Ltd (NSE: KPLC) FY18 Earnings Note

Genghis Cross-Asset Weekly Strategy - 8th February 2021

East African Breweries Ltd (NSE: EABL) 1H21 Earnings Note

KenGen Company Plc (NSE: KEGN) FY20 Earnings Note

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