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Carbon Credits & Carbon Markets
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mwanahisa
#11 Posted : Saturday, July 23, 2011 6:10:11 PM
Rank: Elder

Joined: 6/2/2008
Posts: 1,438
Kindly let us stick to KGN not KK. KGN's total revenue last year was 11.1 Billion with a profit of 1.96 Billion. Taking this into context, wouldn't you agree that 4.3 B from carbon credits only sounds rather incredible?

I may also point you to the PIBO prospectus for KGN which has some financial projections. They seem to have forgotten to include the CCs income since the figures there are not all that rosy.

Cde Monomotapa wrote:
mwanahisa wrote:
And just to do the math if 35 MW = 300 mil, 500 MW = Kshs 4,285,714,000. Looks like an awful lot of money (kind of unbelievable) unless this is strung out for many many years. What do you say?

KK turns over 100s of Bs a year. I don't find that unbelievable.
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mwanahisa
#12 Posted : Saturday, July 23, 2011 6:12:01 PM
Rank: Elder

Joined: 6/2/2008
Posts: 1,438
Sorry, I was a bit to quick to shoot from the hip not knowing you were working on a response. But perhaps, you can still address my concerns....

Cde Monomotapa wrote:
Nevertheless, i have to agree with @mwanahisa about the interpretation of that 300M quoted by BD i.e is p.a or over a period. That will have to be confirmed by management soon. Bottom line, there is money to be made in this AIR trading and I am confident that Kengen's current & pipeline green energy capacity will yield the highest returns accessible to the public (Via NSE)
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Cde Monomotapa
#13 Posted : Saturday, July 23, 2011 6:12:40 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
Cde Monomotapa wrote:
Nevertheless, i have to agree with @mwanahisa about the interpretation of that 300M quoted by BD i.e is p.a or over a period. That will have to be confirmed by management soon. Bottom line, there is money to be made in this AIR trading and I am confident that Kengen's current & pipeline green energy capacity will yield the highest returns accessible to the public (Via NSE)
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Cde Monomotapa
#14 Posted : Saturday, July 23, 2011 6:22:28 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
P.S: That's not a concern (the 300M) I have come to learn about today. Read that article a long time ago. The C.Credits remain additional income to me as my key interest in Kengen supersedes but is reinforced by it. My key interest is to continue to make $$ by increasing electricty output into a hungry & under-served Vision 2030. (w/o Mulika Mwizi campaigns..just pay ur bills on time, capice!)
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mwanahisa
#15 Posted : Saturday, July 23, 2011 6:36:42 PM
Rank: Elder

Joined: 6/2/2008
Posts: 1,438
Io Capisco. Grazie.

But....

It would be helpful if you could back up the expected increases in revenue as expressed in 14 above with projections of how it will affet KGN's bottomline. My reading of the PIBO prospectus appears to suggest that the increases in revenue will be more than offset by the increases in expenditure at least for the first and second phases of KGN's expansion of generating capacity.
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Cde Monomotapa
#16 Posted : Saturday, July 23, 2011 6:51:33 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
mwanahisa wrote:
Io Capisco. Grazie.

But....

It would be helpful if you could back up the expected increases in revenue as expressed in 14 above with projections of how it will affet KGN's bottomline. My reading of the PIBO prospectus appears to suggest that the increases in revenue will be more than offset by the increases in expenditure at least for the first and second phases of KGN's expansion of generating capacity.

Hold up... I have Eddy on the line. Capex will be off-set against PIBO funds and other financing options & these appear in the cash-flow statement & not P&L save for finance costs. In terms of Opex (thanx to McKinsey of KCB too) KGN has exemplary y-o-y cost control which I can only compare to NMG. I'd be lying to say how much will be made off C.Credits but it is my great expectation that along with Treasury interest income will go further to reduce our net finance costs (PIBO, Donor funds e.t.c) in every given financial year going-forward. That's one of my critiques of this Co. & so far so good smile
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Cde Monomotapa
#17 Posted : Saturday, July 23, 2011 7:01:53 PM
Rank: Chief

Joined: 1/13/2011
Posts: 5,964
Thus, even if KGN made 4.2B off C.Credits over say...4yrs..that in essence is 1B p.a and that goes a long way in easing the burden off and or boosting annual revenue and hence yearly profits.
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