K-Electric announces financial results for FY 2022: net profit declines, current economic situation remains a challenge - Press Release issued by K-Electric.

Karachi -- September 21, 2022 (PPI-OT)

Following is the text of press release issued by K-Electric

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The Board of Directors of K-Electric approved the financial results for the company on 20 September 2022 for the year ended on 30 June 2022. Driven by prudent policies, the Company's key areas of operations showed strength. T and D losses further reduced from 17.5% to 15.3% in FY 2022. This improved performance was partly set-off due to the negative impact on account of the Mid-Term Review (MTR) decision.

Driven by the operational improvements, the Company's gross profit increased by 22% as compared to last year. However, external factors including increase in consumer tariff and current economic condition impacting consumers' propensity to pay lead to increase in impairment loss, substantial devaluation of Pakistani rupee in the international currency market resulted in exchange loss and increase in policy interest rates translated to increase in finance cost.

As a result, the net profit reduced to PKR 8,524 million as compared to a net profit of 11,998 million during FY 2021. The Earnings per Share (EPS) for the year remained 0.31 rupees per share in FY22 as compared to EPS of 0.43 rupees in FY21.

In the first half of FY 2022, the economy recovered from the adverse socio-economic impacts of the COVID-19 pandemic with economic activity carrying momentum from the last year and witnessed a GDP growth of 5.97% during FY 2022, as reported by the Pakistan Economic Survey 2021-2022. The last quarter of FY 2022, however, in particular, saw material socio-political challenges, both locally and on the international front, having a consequential impact on the macroeconomic factors.

According to Moonis Alvi, CEO, K-Electric, "The previous fiscal year brought some unique challenges and put the power sector to test. Our Company-wide focus on embedding digitization and automation into our core business processes enabled KE to maintain its agility and sustain its commitment to the people and city of Karachi.

Continued investment has demonstrated improved network stability during an unprecedented monsoon season, and we have also reduced our network losses to deliver safe, secure, reliable and uninterrupted power. It is critical that the Federal Government and associated stakeholders address legacy issues which can help us actualize our potential and make a lasting impact in Pakistan's economic and industrial hub, while also contributing positively to...