Thursday, June 24, 2021

Saudi Electricity returns to profit after government fee canceled

— The company reported net profit of SR1.69 billion ($450.4 million) compared to a loss of SR2.44 billion in the year-earlier period Updated 20 sec ago

Arab News

May 05, 2021 11:36

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DUBAI: Saudi Electricity, the region’s biggest utility, returned to profit in the first quarter helped by sweeping new reforms aimed at boosting its efficiency.

The company reported net profit of SR1.69 billion ($450.4 million) compared to a loss of SR2.44 billion in the year-earlier period.

Sales rose 17 percent to SR13.35 billion, the company said in a stock exchange filing on Wednesday.

It attributed the improved performance to a number of factors including the cancellation of the government fee which took effect from the start of this year as well as well as reduced overall debt levels.

Last year Saudi Arabia introduced a number of electricity sector reforms aimed at changing the country’s energy mix and improving the efficiency of the transmission network which could lead to the eventual integration of the Kingdom’s electricity network with some of its neighbors.

At the same time its government liabilities were converted into a perpetual equity-like financial instrument.

A new revenue model agreed at the same time has also meant the company is better able to achieve a fair return on invested capital.

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