During the period most of them were on a borrowing spree and with some of the debt maturing,money had to be kept aside for debt repayments.
Others financial performance is worse now like HFCK, Portland cement,Lafarge Bamburi.

And by the way why does KenGen pay dividend 7 months after year-end? Seriously there should be a cap of some sort on how far back a company should pay dividends after year end. Most big banks usually pay after 4 months (YE December, Payment April). Some years KCB stretches this to July!

Some years back Barclays used to pay in April. Yes true that most big banks pay in May. I got the month wrong.

The Auditor's report on Kengen raises 2 issues which necessitated the qualified report:
1. Non-valuation of Property, Plant and Equipment since 2015:
The company revealed to investors on Tuesday that it couldn’t carry out a valuation on assets last year owing to COVID-19 travel restrictions.
The company however says it will complete the revaluation which is carried out once every five years by the end of 2021.
The expected revaluation of assets is likely to change the company’s net earnings reported in the period.
The depreciation affects net earnings which is usually represented by revenue left after the offsetting of all costs, expenses, depreciation, interest and taxes.
This is because accumulated depreciation is usually a running total of the depreciation expense that has been recorded over the years and which is offset against the sale of the asset.

"Management...were unable to secure services of an appropriate expert to cary out its asset's valuation..."

2. Work in Progress:
Auditor General Nancy Gathungu has flagged Ksh.99 billion worth of idle projects in electricity generating company KenGen.

Ksh.4.5 billion relating to transmission lines put up in the 2008/2009 financial year but which have not been used to further KenGen’s business but are instead being used by another company for revenue generation.
Instead, KenGen continues to service a loan and accruing interest in respect to the project from which it doesn’t book revenues from, raising the firm’s operating costs in the process.

Ksh.79.3 billion was used in the drilling of wells between 2011 and 2015 but the wells have not been connected to any plant for the generation of power and ultimately, revenues for KenGen.
The project financed by a loan from the Export-Import Bank of China (EXIM) continues to attract interest payments without a corresponding value for money to the electricity generating company.

A further Ksh.646 million was deployed towards feasibility studies for wind power projects that lack both contract documentation and feasibility study reports.

The balance of questionable spending by KenGen covers the construction of a building referred to as Hydro Plaza, whose final cost was inflated by Ksh.111.3 million or a respective 74 per cent after a change in a contractor with no explanation given to the significant increase in the cost of the building.

“The management has not provided reasons for the delay in conclusion of feasibility studies for over eight years,” adds the audit report.



“projects totalling KES 94.8B in respect of capital projects initiated several years back but had no movement over the last 2- 10 years & which may have stalled...Mgt did not provide explanations on why the projects have not been completed & capitalized.

Link:https://www.kengen.co.ke/images/2021/KenGen-Abridged-Results-Outlined-Press-Ready.pdf