CEB back in black in 2Q on higher revenues and eased generation cost

The Ceylon Electricity Board (CEB) returned to profit during the three months ended in June (2Q21), as revenues rose, generation costs eased while the finance cost fell, improving the financial prospects of the key power utility in the country for the second quarter in a row. 

The CEB reported an after-tax profit of Rs.8.04 billion for the April-June quarter, compared to a loss of Rs.1.82 billion in the corresponding quarter last year, when the electricity consumption was below normal, due to the lockdowns that affected industrial activity for nearly two months during that period. 

The state utility generated revenues of Rs.73.4 billion for the three months under review, up 12.2 percent from a year ago period. 

However, the cost of sales, which largely contains the generation cost and payments to the Independent Power Producers (IPPs) for power it purchases, little moved by 2.5 percent during the period, perhaps reflecting higher conventional and non-conventional renewable energy sources contributing to the power generation mix during the period, led by hydropower. 

The June interim report is the CEB’s second so far since the power utility raised Rs.20 billion on the Colombo Stock Exchange, via a listed bond on April 8, to settle part of its dues to the IPPs. By June-end, the CEB had payables of Rs.183.5 billion, down from Rs.189.3 billion at the start of the year. 

In the first three months ended in March 2021, the CEB cut losses to Rs.8.9 billion, from Rs.17.6 billion in the same period in 2020. 

During the six months that ended in June, the CEB narrowed its losses to Rs.936.2 million, from the corresponding period loss of Rs.19.8 billion, last year. The accumulated losses up to June 30, 2021, were Rs.142.8 billion. 
Notably, during the quarter under review, the CEB’s net finance cost fell by as much as 37.8 percent to Rs.3.8 billion from the year earlier period. 

By June-end, the CEB had long-term loans of Rs.387.5 billion, up from Rs.357.7 billion at the start of the year and short-term loans of Rs.48.1 billion, up from Rs.41.8 billion.