Uganda Electricity Distribution Company Limited (UEDCL) has unveiled a dazzling 10.5% surge in revenue, setting the stage for an Annual General Meeting that felt more like a theatrical production.
The curtain rose in Kampala on February 28th, 2024, revealing a spellbinding Shs88.5 billion in revenue for the fiscal year ending June 2023.
The architects of this financial marvel were the maestros of operational efficiency, their symphony of success resonating in increased customer connections.
As UEDCL emerged as a financial virtuoso, the narrative took an unexpected twist when total expenses embarked on a daring ascent, scaling the heights by 21% to reach the awe-inspiring summit of Shs73.7 billion.
The villains in this tale? A cacophony of rising electricity purchase costs, the crescendo of heightened fuel prices, and the dramatic surge in repair and maintenance expenses for the aging network.
Yet, against this tempest of financial turbulence, UEDCL emerged unscathed, donning the cloak of a financial hero, proudly brandishing a positive Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of Shs14.8 billion. A valiant figure, though slightly diminished by a 22.6% decrease from its previous year’s triumphant standing.
In the face of such fiscal drama, UEDCL’s Managing Director, Paul Mwesigwa, stood as a colossus of stability. With eloquence that echoed through the hallowed halls of financial discourse, he spoke of the company’s unwavering commitment to stability, promising a relentless pursuit of operational efficiency, customer service excellence, and the holy grail of business sustainability.
Amidst this financial odyssey, UEDCL navigated its cardinal responsibilities with the finesse of seasoned navigators. From overseeing the UMEME electricity distribution concession to running a creosote plant that supplied treated wooden poles to the national electricity grid, UEDCL’s portfolio resembled a tapestry of benevolence.
Yet, as in any epic, the tale was not without its dragons. UEDCL faced challenges that tested its mettle—a scarcity of funds for necessary investments, the vast distances in distribution networks at 33kv due to limited 132kv transmission coverage, and the relentless management of energy losses, which stubbornly stood at 21% in 2023, exceeding the Electricity Regulatory Authority’s elusive target of 20.1%.
The nefarious activities of vandalism and Umeme Ltd’s non-payment of lease fees for the use of UEDCL assets further strained the company’s operations, leading to a net deficit after tax of Shs2.18 billion for the period.
Yet, amidst these trials, a subplot unfolded—the saga of energy loss management. UEDCL’s prowess improved, evolving from 25% in 2022 to a more palatable 21% as of June 30, 2023. A triumph, albeit with the bitter aftertaste of falling just short of the Electricity Regulatory Authority’s approved target.
As the saga continued, whispers of a takeover resonated through the corridors of power. UEDCL, armed with resolve and ambition, declared its readiness to seize Umeme’s domain.
The price of this conquest? A staggering $70 million per year, a leap from Umeme’s current expenditure of approximately $40 million. Technical staff, resembling seasoned warriors, ventured into the field, establishing areas that required repair and maintenance once Umeme exits the stage.
Guiding this epic was the Minister of Energy and Mineral Development, Ruth Nankabirwa, a regal figure who chaired the AGM with a sense of purpose.
With unwavering commitment, she pledged the government’s support, painting a vision of UEDCL’s triumphant takeover, ensuring the sustainability of power supply—a key factor for the economic heartbeat of the nation.
The saga of UEDCL unfolded as a thrilling epic, replete with financial triumphs, formidable challenges, and an impending conquest that promised to reshape the power sector landscape.
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