Kaduna Electricity Distribution Plc has recorded a total comprehensive loss of N12,088,470 in the 2015 financial year, just as the Company held it first ever Annual general Meeting (AGM).
This was contained in the Company’s annual reports of the year ended 31st December 2015 presented by the Chairman of the Company, Alhaji Yusuf Hamisu Abubakar, 00N to the shareholders during the maiden annual general meeting (AGM) of the company held at the end of last week in Kaduna. This development, according to some industry watchers, portray a good omen for Nigerian Electricity Supply Industry.
The Chairman of Kaduna Electric identified certain macro-economic, regulatory and operational constraints that hindered the performance of the company during the period under review.
According him, the country “is in the midst of macro-economic head winds; oil prices fell from over $108.40 per barrel in May 2014 to $52.85 per barrel in April 2017, resulting in severe downward pressure on the naira as the naira devaluated from about N220 to over N400 against the US dollar at the parallel market over the same period. In addition to this, Nigeria continues to have one of the highest rate of inflation with a year on year increase in the price of goods and services of 18.72% as at January 2017, a metric which Kaduna Electric must bear without a transfer of a burden to customers as a result of the regulated pricing in the form of tariff”.
Other challenges faced by the company since taken over as enumerated by the Board’s Chairman includes unfulfilled promises made to prospective investors during the bidding process, regulatory interference, non-cost reflective tariff, MDAs debt, capital expenditure limits, low electricity generation, failure of NERC to implement subsidy through the administration of Power Consumer Assistance Fund, non-availability of low interest credit facilities and frequent government intervention in the electricity market.
Despite the numerous challenges, the Company, Alh Yusuf Hamisu Abubakar announced, is being re-positioned for improved performance. He enumerated some of the achievements recorded by Kaduna Electric during the period under review to include the stabilization of the distribution network operations, increasing the distribution capacity by over 1500MVA, supply and installation of 25,000 smart meters and expansion of the network to underserved areas in the Company’s franchise area.
He also assured the shareholders of the proverbial light at the end of the tunnel, citing the recent constitution of the Board of NERC and the release of the Power Sector Recovery Implementation Programme by the federal government as a sign of a brighter future.
The Managing Director/Chief Executive Officer, Engineer Garba Haruna in his contribution, assured the shareholders that, in spite of the regulatory, network disruption and liquidity risks which the Company has to contend with, Kaduna Electric has commenced the mapping of the 33KV, 11KV and the LT networks which has so far yielded positive result.
According to him, the networks mapping has “provided clarity of the actual company’s network, while also increasing customers’ population from less than 300,000 to about 435,000 presently in the system. At conclusion of the programme in2017, we hope to achieve customers’ enumeration and capturing of about 750,000 while making consistent growth to about 1,000,000 by 2018”.
In a related development, the Company has received a clean bill of health from the External Auditors, Messrs. Ahmed Zakari & Co. In the Independent Auditors Report presented at the AGM and signed by Mr. Najib Imam for Ahmed Zakari & Co., the audit firm affirmed that they have audited the accounts of Kaduna Electric and found same to be in full compliance with all financial reporting standards.
According to Najib Imam, “we have audited the accompanying financial statements of Kaduna Electricity Distribution Plc, which comprises the statement of financial position as at 31st December 2015, the statements of profit or loss and other comprehensive income, the statement in changes in equity and the statement of cash flow for the year then ended, and a summary of significant accounting policies and other summary explanations. In our opinion, the accompanying financial statements presents fairly in all material aspects, the financial position of Kaduna Electricity Distribution Plc as at 31st December, 2015 and of their financial performance and cash flow for the year then ended in accordance with the Companies and Allied Matters Act, Cap C20, LFN, the Financial Reporting Council of Nigeria Act No.6, 2011 and the International Financial Reporting Standard”.
The first Annual General Meeting (AGM) to be held by the Company had in attendance all the shareholders and the representative of the Federal Government. The meeting considered and unanimously re-elected the six non-Executive Directors and reconstituted the Audit Committee for the Company.