By Max Patrick Ocaido
KAMPALA. UMEME Limited has released financial results for the first half of 2018 and announced a total interim dividend pay-out of Shs20.6billion based on the stellar performance of the company over the period of January to June 2018.
The dividend subject to deduction of withholding tax, where applicable, will be paid on or about January 11, 2019 to shareholders in the books of the company at close of business on December 20, 2018.
Umeme Managing Director, Selestino Babungi said the sector was on a steady growth after the demand by industrial consumers grew by 8.6%, up from the 7.5% registered in the same period the previous year.
"In simple terms, the sector is growing. Maximum demand grew just slightly under 600MW. The main drivers are the large industrial customers who are registering high annual growth rates of up to 13%," Babungi said.
He noted that the industrial demand for electricity was in line with the GDP growth, which is projected to grow at 6% in the 2018/2019 financial year, up from 3.9% in 2017, adding that GDP growth goes hand-in-hand with electricity demand. In brief, sector revenue increased by 19.3% to Shs7683bn, gross profit increased by over 20% to Shs261.5bn while cash generated from operations also rose to Shs165.6bn.
Babungi pointed out that the setting up of National Cement Company and the new Hima Cement plant, the two new cement plants in Tororo and the expansion of Tororo Cement Industries, all of which were fully commissioned, boosted the industrial sales.
"Existing industrial consumers like Coca-Cola and Roofings have also boosted their production. The Buy Uganda, Build Uganda drive is helping a lot. The South Sudan and DR Congo markets have also reopened. Commercial use of electricity is fundamental. Industrial use is essential in up taking the increasing generation capacity," he explained.
According to the un audited interim financial statements for the 6months period ended June 30, 2018 which were also reviewed by KPMG, an independent auditors, the Electricity Supply Industry continues to register growth in the generation, transmission and distribution segments.
"During the period, the installed generation capacity increased to 949 MW following the commissioning of the Nyamwamba HPP (9.2MW). The construction status of Isimba and Karuma HPPs is estimated at 87% and 80% respectively," the report reads.
The report adds that electricity demand during the period also increased as peak demand reached 596 MW, an increase of 5.9% from the first half of 2017. Electricity sales in GWh also grew by 8.6% compared to the same period last year.
"This growth was largely driven by industrial demand which grew by 11.3%, supported by the addition of 46 new industrial customers to our customer base and increased capacity utilization within existing industries," the report adds.
During the first half of 2018, the company added up to 82,373 customers to the grid, increasing its total customers to a record of 1,207,664 and now targets to add a total of 200,000 new customers to the grid by end of 2018.
Umeme also continues to register progress in energy loss reduction and apparently, energy losses for the six months reduced to 16.7% compared to 17.5% for the same period in 2017.