Umeme has reported a Sh6.1 billion loss for the half year period ended 30 June 2025 compared to a net profit of Sh478 million it reported in the six month period last year. The company’s share price dropped 5.9 per cent to close the day at Sh8.98.
The company’s revenues fell to Sh18.5 billion after falling to generate revenue in the second quarter due to end of the concession agreement, from Sh42.4 billion generated in the first half last year.
Umeme wrote off intangible assets valued at Sh4.9 billion as part of the requirement to revalue its assets to their current value as required by the International Financial Reporting Standards.
“As required by the International Financial Reporting Standards (IFRS), the valuation of assets and liabilities is based on prudent accounting principles. As such, provisions have been made based on previous asset bases which have been revalued to their current fair value. The changes are due to the end of the electricity distribution concession and pending resolution of the dispute with the Government,” the company said
“An amortisation charge of Ush134 billion was therefore incurred in the period, adjusting the intangible assets to the current valuation, pending the resolution of the dispute with the government of the buyout amount claim. As a result, the company recorded a loss of Ush167 billion compared to a profit of Ush13 billion in the same period in 2024,” the company said in the commentary accompanying the interim financials.
The Sh6.1 billion loss reduced the company’s shareholders’ funds by 71.5 per cent to Sh2.5 billion(Sh1.54 per share) as of 30th June 2025, from Sh8.9 billion(Sh5.49 per share) as of 31st December 2024. The company paid an interim dividend of Sh8.14 per share.
Umeme is seeking $292 million (Sh38 billion) from the Ugandan government through international arbitration in London, after disputing the buyout amount following the end of its concession in March.
The company submitted a buyout claim of $410 million (Sh53 billion), but the Uganda government paid $118 million (Sh15.3 billion) leading to the dispute.
Government of Uganda is obliged to pay interest on the buyout amount equal to 10 per cent per annum, for the period 30 days to 45 days after the concession termination date, increasing to 15 per cent per annum for the period from 46 days to 90 days after the concession termination date, and then 20 per cent per annum, after 90 days until the buyout amount is ultimately paid in full.
The company’s share price has been relatively volatile this year as a result of the uncertainty surrounding the buyout amount.
