The Observer (Kampala)

Uganda: Umeme Promises a Better 2014

Power distributor Umeme is anticipating a much better new year, as it seeks to make most of its services electronic. This, according to General Manager Sam Zimbe, will help Umeme cut costs and respond to customers' concerns quickly.

"We want to institute an e-control centre. In case a problem happens in Bushenyi, we are able to detect it and fix it," Zimbe said.

He said they would emphasise that customers request for e-bills instead of waiting for physical deliveries, which might take longer. Speaking to journalists recently, Zimbe announced that the company had started paying its shareholders dividends basing on its interim results of up to June 2013.

At least Shs 13bn is to be paid to 6,500 shareholders, Umeme said. He said Umeme would pay Shs 8 per share - based on the power distributor's performance. The dividend is, however, lower than the Shs 15 per share it paid out last year.

Umeme registered Shs 164bn in retained earnings for the half year, up from Shs 141.4bn for the period ended June 2012.

"Payment for the dividends starts right away," Zimbe said.

"The company has had a good financial performance during this period. Our earnings grew by 12 per cent compared to same period last year."

Only those shareholders that were on Umeme books by December 9 would be paid. Umeme listed its shares at the Uganda Securities exchange (USE) last year before it successfully cross-listed on the Kenyan bourse, becoming the first company from Uganda to do so.

After its Initial Public Offer - oversubscribed by 35 per cent - the company's share has continued to perform well both on the Ugandan and Kenyan bourses. Umeme's share is trading around Shs 365 at the USE.

Meanwhile, Zimbe said the company would continue investments to increase on connections. Earlier last month, government said it would not terminate Umeme's contract after a recommendation by the parliamentary energy committee.

In November, the power distributor secured a $190m loan from the World Bank's IFC, which invested close to $5m in the IPO.

Umeme said it would use the borrowed funds to expand and upgrade its distribution infrastructure.

Yaka for all

Umeme Chief Operations Officer Florence Nsubuga said they would continue to push for the widespread roll-out of the pre-paid (Yaka) meters. Nsubuga said Yaka would help them cut power losses especially caused by defaulters and rampant thefts.

Umeme faces resistance from some Ugandans, who claim pre-paid meters should be a voluntary option by individual power consumers and not be forced on those who don't like it. By the end of 2014, she said, they want at least all power consumers to use pre-paid meters.

Nsubuga says they want to reduce power losses to 20 per cent, from the current 24.1 per cent.

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