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Mon 13 Apr 2009 08:12 AM

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DEWA makes $1.5bn profit for 2008 due to rise in revenues

Revenues increased by 52.5%, cost of generation, distribution fell by 32% last year.

Dubai Electricity and Water Authority (DEWA) made a profit of AED4.24bn ($1.5bn) last year, compared with a loss ofAED744m the previous year, as a result of higher revenues and lower generation and distribution costs, it was reported on Monday.

The figures for the emirate's sole utility provider come just a week after it announced a successfull refinancing deal of a $2.2bn loan, which had been due to complete later this month.

Other figures show that DEWA’s revenue during 2008 increased by 52.5 percent to AED9.29bn, while the cost of generation and distribution fell by about 32 percent to AED4.34bn.

Finance costs rose by 46 percent to AED489m in 2008 as the utility's borrowings increased, according to a statement posted on the Nasdaq Dubai website, reported in UAE daily Gulf News.

DEWA's refinancing deal saw it receiving $2.2bn from a syndicate of 18 banks, to cover an AED8bn one-year Islamic lease it had arranged in April 2008.

Meanwhile, electricity consumption increased by 13 percent in January this year and by 17 percent in February compared with the previous year, according to Saeed Mohammad Al Tayer, managing director and CEO of the utility operator.

However, a more "realistic forecast" of future demand, which is expected to fall off in line with a slowdown in construction activity, would be available in May to June, he added.

Revenue for electricity hit AED6.7bn last year compared with AED4.2bn in 2007, while water revenue reached AED2.55bn compared with AED1.9bn in 2007.

It saw a 22.7 percent drop in the cost of power generation and desalination expenditure, but the company has pledge to invest AED70bn in power generation and water desalination projects in the next five years.

Dewa has more than 480,000 customers and its power generation capacity is 5,448 megawatts (MW).

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Michael 10 years ago

No, really?? A profit from a monopoly? It is the one service that can engineer it's own profit exactly to the dirham at any given year.