Geregu Power Plc, a listed power generation company in Nigeria, has reported a 148.4 percent rise in its after-tax profit in the first half of 2024.
According to the power-generating firm latest unaudited financial statement, its after-tax profit rose to N20 billion in the first half of the year from N8.05 billion reported in the same period of 2023.
The company’s revenue for the period grew by 132.9 percent to N80.6 billion, driven by higher proceeds from both energy sold (N50.8 billion) and capacity charge (N29.6 billion).
However, impairment losses on trade receivables also increased significantly to N6.08 billion from N1.9 billion in the corresponding period of 2023.
Impairment loss on trade receivables is a non-operating expense that is recorded when a company expects to receive less cash than the carrying value of its trade receivables.
Trade receivables are amounts owed to a company by its customers for goods or services that have been sold on credit.
Read also: Geregu Power generates N5bn from electricity sales
Administrative expenses amounted to N5.04 billion in the period under review from N2.41 billion recorded in the same period of 2023.
Of the administrative expenses, personnel cost gulped N1.2 billion of the total amount, followed by repair and maintenance of machinery and plant with N579 million compared to only N89 million a year ago.
The company’s other income declined by 82 percent to N1.96 million from N11.3 million a year ago, this was as a result of the firm’s ability to generate foreign exchange gains during the period under review.
Finance cost during the period declined by 21 percent to N4.85 billion from N6.14 billion the same period in the previous year. The statement disclosed that the decline in finance cost was on the back of a 40 percent decline on the cost of borrowed funds as Geregu’s loan appetite declined by 13 percent.
The interest expense on the bond issued to secure the power plant and the money it spent to service bank loans together amounted to N1.9 billion and N2.9 billion, respectively.
The company that has crossed one trillion market capitalisation on NGX share price rose to N1000 as of June 30 and its earnings per share rose to 148.7 percent to N8.01 from N3.22.
The power-generating firm’s total assets rose to N207 billion in the first six months from N155 billion in the same period of 2022 while total liabilities rose to N162 billion from N118 billion.
Its shareholders fund during the reviewed period also rose to N45 billion from N37 billion.
The company’s cash flows for the six months of 2024 were as follows: Net cash from operating activities amounted to a negative N24.8 million from N30.6 billion recorded in 2023; net cash generated from investing activities amounted to N4.2 billion from N3.7 billion recorded in 2023 as a result of an increase in interest received.
Net cash used in financing activities recorded amounted to a negative N30.6 billion from N41.6 billion generated in 2023.
Cash and cash equivalent for the period decreased to N43 billion from N44 billion recorded in the same period of 2023.
According to a publication by billionaires Africa, Geregu Power Plc, founded in 2006, began supplying electricity to Nigeria’s national grid in 2007. Its 435-megawatt (MW) capacity power plant contributes to the nation’s energy needs.
In 2013, a consortium led by Femi Otedola’s Amperion Power Distribution Company Limited acquired Geregu Power. The consortium included Calvados Global Services Limited and State Grid Shanghai Municipal Electric Power Company, the world’s largest utility.
Last month, Geregu Power Plc signed a Memorandum of Understanding (MoU) with Siemens Energy to jointly develop solutions for capacity expansion at the Geregu 1 power plant.
“The deal aims to triple Geregu’s total capacity from 435 to 1,200 megawatts (MW) as well as ensure sustainable, resilient, and efficient power generation while safeguarding the longevity of assets, all aimed at supporting the growth and sustainability of the Nigeria Electricity Supply Industry (NESI),” the company disclosed in a statement.
