I have just had a look at the presentation that the MD made on the launch of the rights issue on 26th November 2010.

This guy needs to go for lessons from JM of Equity and/or MJ of Safaricom on how to sell his company.

His target for PBT for KPLC is a "whopping"(sic) Kshs 7.0 B in 2015 from the current 5.632 B. This is a MERE 24% higher than the current status.

This is notwithstanding all other targeted metrics being much higher/better e.g. Sales of MW hours per employee, system losses, Total customers on the grid etc. Note, by 2015, he expects some additional 1,749 MW of capacity to have been added on.

So, what will he (they) be doing with the additional revenue? It looks like they are anticipating a huge increase in costs and/or overheads. Well, I guess it's going to be great being a KPLC employee. They should "brace" themselves for a huge increase in salaries/wages. Something is wrong here!

What do y'all think?

Are u sure he meant 7.0B by 2015? It could be that he meant next year, 2011!
If that's what he meant, we have no business waiting for 5 years to get 24%, which works out to a paltry 4.8% pa, not enough to take care of the time value of money!

This is in black and white on Pg 11 in his presentation with the page title - Key Success Measures. I just hope that this was a typo. Otherwise, it shows a serious lack of ambition. I have not yet seen the Information Memorandum. Once I do, I will be scouring it thoroughly to see whether it has the same crap! BTW, does anyone have the soft copy of the IM?

@Muganda, meaning?

This can't even be a daydream.

If I was dreaming of KPLC, you can be sure it would be in realm of over 11 B in PBT by 2015 at the very least. CAGR in PBT over the last 5 years has been 18%, so we should expect it to be maintained or increased.

If 7B is Njoroge's dream, it can only be a nightmare for those of us who may be getting into KPLC!!!!

Maybe the IM should have a "caveat emptor" warning.

Would also think it's an error. However, kplc is a parastatal and a profit-sensitive one to the public, so investors should always bear this in mind. highest PROFIT is not the ultimate goal of a parastatal. rather it is efficient affordable public service.

On another slide I have seen the projected PBT for 2010-11 is Kshs 6.061 B. That's an 7.6% increase. That implies that in the subsequent 4 years the increase in PBT will slow down to 15.5%. Why?

I accept that KPLC will be getting deeper into the clutches of GoK, and will therefore become less profit oriented. All the same , I can't help but think that the financial projections on these slides are off the mark. They are way out of sync with the other metrics.

Let's wait for the IM so that we can interrogate this further.

This MD needs to go back to the drawing board. That PBT cannot be right.

@Mwanahisa

The government had more control in KPLC when they had preferential shares that the scenario envisaged. In any case the government had always had control of the company from Gichuru's time to present. Like someone pointed, the essence of the gova having 50.1% shareholding is to enable KPLC access cheaper loans.

.....leta complete link sir

@tupac - You don't need to babysit... Kwani, jamaa can't google or just go the website? [I did so after seeing your post]