K-Electric Reports Rs. 30.9 Billion Loss in FY23 Amid Challenging Conditions
K-Electric (KE) has disclosed a net loss of Rs. 30.9 billion for the fiscal year 2023, a stark contrast to the Rs. 8.5 billion profit it posted in FY22. The company attributes this downturn to a multitude of sociopolitical and economic challenges impacting various sectors, including KE.
Factors such as surging inflation, policy rate hikes, rupee devaluation, and reduced economic activity have weighed heavily on KE’s operations and profitability. The company saw a 7.3 percent drop in units sent out due to decreased economic activity, while inflation and government-mandated electricity price hikes affected customer payment habits, causing KE’s recovery ratio to decrease from 96.7 percent to 92.8 percent between FY22 and FY23.
KE also cited increased finance costs due to a higher effective borrowing rate. Despite these challenges, the company continued to invest in Karachi’s power infrastructure, commissioning the 900 MW RLNG-based BQPS-III plant and advancing construction on its flagship 500kV Grid and 220 kV Dhabeji grid to bolster electricity supply.
CEO of K-Electric expressed commitment to Karachi and innovation in business operations, emphasizing that electricity pricing decisions are in the hands of the Federal Government. KE remains dedicated to combating electricity theft, aiding customers in clearing dues, and pursuing renewable energy goals.
KE is actively addressing these challenges and working on tariff renewal to secure a sustainable, cost-reflective, and investment-friendly tariff structure.