Rising sales push DEWA H1 income to AED1.63bn

State-owned utility saw revenue gain 42% in the first half, but finance costs jumped
The UAE is one of the highest per capita consumers of water and electricity in the world
By Claire Ferris-Lay
Tue 23 Aug 2011 04:24 PM

Dubai Electricity and Water Authority (DEWA), the monopoly
state utility, said Tuesday its income in the first half of the year rose nine
percent on increased sales.

Income in the six months to June 31 rose to AED1.63bn from
AED1.5bn in the year-earlier period, the state utility said in a statement to
Nasdaq Dubai.

Revenue gained 42 percent to AED6.6bn, the company said, but
finance costs jumped to AED1.6bn on foreign currency losses and bank borrowings.

DEWA, considered one of Dubai's strongest assets, has sole
responsibility for transmission and distribution of power and water supply in
the emirate. The UAE is one of the highest per capita consumers of water and
electricity in the world.

Rising demand for power in Dubai, where soaring summer
temperatures drive up air conditioning use, has forced the emirate to buy more
natural gas to feed its power stations.

Dubai's Supreme Council of Energy said this month it planned
to launch a gas strategy in 2012 aimed at cutting energy demand in Dubai. The
emirate’s top energy council also said it would freeze electricity and water tariffs
in the emirate over the coming years.

DEWA’s chief executive said in March the company plans
annual capital expenditures of around $1bn over the next three years and
expects Dubai's energy use to increase by between six and seven percent in 2011.

The utility was rated investment grade by Standard &
Poor's in June. The international ratings agency rated it BBB-, the lowest
investment grade rating on the agency's scale, with a "stable"
outlook, citing the high potential of government support in the event of
financial trouble.

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