Saif Power Limited reported a net profit of PKR 36.07 million (EPS: PKR 0.09) in 1QCY25, significantly higher than PKR 2.14 million (EPS: PKR 0.01) in 1QCY24. In CY24, SPWL reported revenue of PKR 9.67 billion compared to PKR 19.04 billion in the SPLY. The decline in revenue was attributed to lower plant utilization, which stood at 8.23%, while the plant’s availability factor was higher at 94.2% in CY24 compared to 84.6% in the SPLY.
Management reported that the gross capacity of the plant is 225MW, with two gas turbines from GE France and a steam turbine from Siemens Sweden. General Electric is the O&M operator of the plant. SPWL is awaiting revised tariff approval from NEPRA, following which discussions will commence with authorities. SPWL is willing to participate in the CTBCM model.
However, SPWL prefers direct transactions with bulk power consumers rather than contributing solely through CPPA-G. In 2024, the Company, GoP, CPPA-G, the Energy Task Force, and other 2002 Power Policy IPPs agreed to amend contractual terms. Key changes included: Return on Equity to be paid on a hybrid Take-and-Pay basis; revised O&M and working capital tariffs; updated O&M indexation; and capping of the insurance premium at 0.9% of EPC cost. The GoP withdrew arbitration claims, and the Company waived PKR 1.36 billion in late payment interest verified till October 31, 2024, which was charged to profit and loss. In return, the GoP committed to clear all verified outstanding receivables and facilitate the waiver of SNGPL’s late payment claims, failing which CPPA-G would pay.
Post year-end, the amendment was executed, and PKR 5.2 billion in receivables were received, though NEPRA’s tariff notification is awaited. As of December 31, 2024, total receivables stood at Rs. 8.2 billion, including the waived Rs. 1.36 billion. Management reported that receivables have started to accumulate again, currently ranging between PKR 2–2.5 billion. While recent government initiatives to resolve circular debt may lead to clearance for SPWL, the timing remains uncertain.
Saif Cement Limited completed its asset sale and distributed proceeds to shareholders, except PKR 7.9 million pending tax refund under adjudication, to be recognized upon receipt.
The Board declared no final dividend for 2024. Total dividend for the year was 12.5% (Rs. 1.25/share), down from 42.9% (Rs. 4.29/share) last year, paid from CPPA/GoP capacity payments. Going forward, management anticipates circular debt to remain a key challenge for the government and energy sector, especially with rising fuel prices, unless structural reforms are implemented.
However, power demand is expected to recover in CY25 as inflation and interest rates decline. Capacity utilization is expected to remain under pressure due to the shift toward renewables, economic slowdown, and weather conditions, though the plant maintained 100% reliability and 94% availability in CY24. Any excess surplus cash will be distributed to shareholders, as per management
Important Disclosures
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