Inflation Pushes Otedola’s Geregu Power Plant’s Expenses To N5.9bn

Nigeria’s worsening inflation has led to a 112 per cent rise in the administrative expenses of Geregu Power Plant Plc majorly controlled by billionaire businessman Femi Otedola.

The company’s 9-month unaudited interim financial statement obtained by THE WHISTLER showed that the power company also saw an increase in its expenses from N2.76bn in September 2022 to N5.87bn in 2023 .

This was caused by a rise in the cost of repairs and maintenance from N89m to N1.56bn; personnel cost rose from N885m to N1.49bn, while transport, travel and entertainment cost rose from N266.7m to N458.2m.

The company was also exposed to an impairment loss of N3.1bn, which rose from the N162m recorded in nine months ending September 2022.

The company, however, surpassed revenue projection, as this grew by 42.9 per cent in the three quarters of 2023 ending September.

Geregu financial statement showed that it generated N55.74bn up from the N39bn it realized in the corresponding period of last year.

The power generation company (GenCo) said it got its revenues from the sale of energy which amounted to N34.79bn (N24.77bn in 2022) and capacity charge of N20.95bn, up from the N14.2bn realized in September 2023.

Geregu grew its profit by 12.9 per cent from N10bn in September 2022 to N11.35bn in September 2023.

The company also sits on N37.bn cash generated by in the 9 months of 2023 compared to the N4.3bn cash held last year.

Geregu’s net cash rose 760.9 per cent year on year, backed by N25.6bn cash flow from operating activities, N18.9bn trade receivables and N5.6bn Trade and other payables.

Although the company boasts of a strong balance sheet, analysis of its assets shows that Geregu Power’s assets dropped by N16.4bn to settle at N157.5bn in September from the N174bn it recorded in December 2022.

Its liability however fell from N124.9bn in December to N117bn in September after reducing tax liabilities from N27.9bn in December to N15.2bn.