CEB reports turnaround performance in 3Q despite tariff cuts

The Ceylon Electricity Board (CEB) reported a turnaround performance in the three months through September 2024, at both top and bottom-line levels, as the state-owned power behemoth turned to black, helped by the repeatedly raised tariffs in the last two years, despite the cuts to power tariffs earlier in the quarter.

The CEB reported a revenue of Rs.126.80 billion in the July-September quarter, recording a 19.8 percent increase from the same period in 2023, even after twice cut power tariffs this year.

The CEB cut electricity tariffs by 21.9 percent on average in March this year, followed by another 22.5 percent in July, rolling back only part of the jumbo tariff hikes introduced in the middle of 2022 and in 2023, under the instructions of the International Monetary Fund, as part of its reform package sold to Sri Lanka to withdraw all forms of subsidy on electricity and also to introduce cost-reflective pricing.

This was clearly seen from the zero concessions provided to the domestic consumers in their income statement.  

In the process, hundreds of thousands of households and small businesses had to foot a massive jump in their utility bills and thus had to stay in the dark and others went out of business, as they simply could not survive the massively higher interest rates and exponentially higher prices of everything, including the power tariffs.

At operating level, the power behemoth reported profits of Rs.35.24 billion, up 169.8 percent from the same period last year.

The operating profits were supported largely by the Rs.16.43 billion of other incomes and gains, which shot up from Rs.4.97 billion.

The nine-month performance contains a gain of Rs.26.04 billion generated from a sale of 28 percent share ownership the CEB had in LTL Holdings to West Coast Power Company Limited. It cannot be immediately ascertained if any part of this gain is recognised as part of the other incomes and gain in the September quarter.