The Kenya Pipeline Company (KPC) disclosed a substantial 22.9% increase in profit for the fiscal year ending in June, attributing the growth to heightened sales driven by the depreciation of the local currency against major foreign currencies.
As per disclosures made to Parliament, the state-owned entity achieved a profit before tax of Sh7.5 billion, a notable rise from the pre-tax earnings of KES 6.1 billion in the previous year.
Throughout the review period, KPC’s pipeline experienced a significant 6.0% increase, reaching 8,675,034.0 cubic meters, compared to 8,183,995.0 cubic meters in the preceding year. This, coupled with the sharp depreciation of the Kenyan shilling, contributed to an upswing in revenues.
KPC’s total sales during the period amounted to KES 32.5 billion, reflecting a 24.0% surge from KES 26.2 billion in the previous year. The continual depreciation of the Kenyan shilling against the US dollar played a pivotal role in this financial growth, with the exchange rate reaching 140.5 units to the dollar in June, compared to 119.0 units in the same month the previous year.
The company attributes the positive financial performance to increased throughput and the impact of the Kenyan shilling’s depreciation on dollar-denominated sales, resulting in a profit before tax of KES 7.5 billion for the fiscal year 2022/23, as indicated in the official document on KPC’s performance.
KPC also underscored the growing demand for fuel domestically and in transit markets such as Uganda, Rwanda, South Sudan, and the Democratic Republic of the Congo.
Despite the positive financial results, it was noted that the Treasury had set a revenue target of KES 30.7 billion for the same period, anticipating increased fuel demand in both domestic and transit markets.
In the fiscal year ending in June 2022, domestic sales accounted for 55.0% of the total throughput, equivalent to 4,537,535 cubic meters.
The Kenya Pipeline Company is responsible for storing imported fuel and transporting it from the port of Mombasa to the hinterland and neighboring countries, facilitating the efficient flow of energy resources in the region.
