Just hours after President William Ruto's directive for state corporations to remit 80 per cent of their profits after tax to the Treasury, the Kenya Pipeline Company (KPC) has announced its intention to hand over Ksh5 billion for the full year ending June 2023.
President Ruto, in a renewed effort to bolster government revenues, declared, "The time is up for loss-making parastatals."
KPC Managing Director Joe Sang, alongside Energy Cabinet Secretary Davis Chirchir, affirmed that the dividend cheque would be presented to Treasury Cabinet Secretary Njuguna Ndung’u tomorrow.
In December last year, KPC told parliament it had witnessed a 22.9 percent surge in profit for the year ended June, attributed to increased sales amidst the weakening shilling against major currencies.
The state-owned firm reported a profit before tax of Ksh7.5 billion, marking a notable improvement from pre-tax earnings of Ksh6.1 billion in the preceding year.
President Ruto's decree on Tuesday, March 26, includes a stern warning of potential closure for all loss-making government institutions within three years, underlining his commitment to achieving a balanced budget.
During the period under review, throughput along KPC’s pipelines experienced a six percent increase, reaching 8,675,034 cubic metres from 8,183,995 cubic metres.
This surge was further amplified by the substantial depreciation of the shilling, ultimately contributing to a boost in revenues.
Of significant note, KPC achieved a remarkable sales milestone of Ksh32.5 billion, indicating a notable 24 percent escalation from Ksh26.2 billion in the previous year.
The company attributes this impressive growth to heightened throughput, signalling a rising demand for fuel both domestically and in transit markets such as Uganda, Rwanda, South Sudan, and the DR Congo.
In line with government targets, the Treasury had set a revenue goal of Ksh30.7 billion for KPC during the same period, anticipating an uptick in fuel demand across both domestic and transit markets.
Domestic sales, constituting 55 percent of the total throughput, amounted to 4,537,535 cubic metres by the end of the fiscal year ending June 2022.
