Geregu Power is targeting N17 billion revenue for Q1 2023

ABUBAKAR YUNUS Abuja

Geregu Power Plc is targeting to achieve N17.12 billion in revenue during the first quarter of 2023.

This is contained in its Q1 2023 earnings forecast released via the Nigerian Exchange (NGX) and seen by Nairametrics.

More on the projections: The company is projecting to rake in N1.75 billion in gross profit. It will also target profits before and after tax of N5.02 billion and N3.39 billion, respectively.

Also, note that the projected income tax for the period is N1.63 billion, even as the cost of sales was projected at N9.27 billion for the period.

Latest earnings: Geregu Power Plc posted revenue of N39 billion in its Q3 2022 unaudited financial report. This is less than N54 billion reported during the corresponding period of 2021.

The decline, according to the company, was due to nationwide force majeure declared by Shell Petroleum Development Company Limited on the Forcados oil terminal pipeline. The force majeure impacted gas supplies to the plant, particularly between July and September.

The company further commented on the revenue shortfall in its unaudited financial statements for the third quarter of 2022, saying:

“The decline in revenue was largely due to gas supply constraints in Q3, 2022, which eventually led to the drop in the capacity delivered and energy sent out of 1314439Mwh as of 30 September 2022 as against Capacity delivered and Energy sent out of 1855920Mwh as at 30 September 2021,” the company said.

Cost-cutting measures: In the meantime, the company adopted an effective cost-saving strategy that saw administrative costs reduce from N10.9 billion to N2.9 billion in 2022, thus cushioning the effect of the revenue shortfall.

The operating profit stood higher at N16 billion, up from N15.1 billion in the nine months of 2021.

An increase in finance cost, largely attributable to the medium-term bond of N40.085 billion issued by the company in 2022 for its planned acquisition, moderated the profit before tax and profit after tax to N13.9 billion and N10 billion respectively.