FEA records $32.5 million profit
August 22, 2014 1:02 am
The Fiji Electricity Authority has recorded a net profit of $32.5 million after tax for the financial year ending December 2013.
However there was a decline in profit when compared to 2012, as the Authority had achieved $75.3 million.
The Authority says there are three key reasons behind the decline in profit last year.
These include the reduction in tariff by 5 per cent from January last year which resulted in a sales drop of around $16 million dollars.
An increase in fuel cost of around seventeen point five million dollars due to increase in thermal generation to complement in reduction of hydro generation.
And $13.5m of tax benefit recorded in 2012 as a result of the one-off tax concession approved by the government of the Nadarivatu Hydro project.
Attorney General and Minister for Public Enterprise Aiyaz Sayed-Khaiyum says, it is important to maintain profitability at a certain level.
FEA like all other state owned enterprises and statutory bodies must maintain a level of profitability to be able to re-invest in its assets because if you don’t do that – then for example the infrastructure like Monasavu, infrastructure like Nadarivatu and even your lines etc cannot be maintained and the we will play an enormous amount of catch-up game – that means enormous amount of capital investment after a period of time. So if you have a certain amount of profitability that allows you to invest back into your assets – all of that needs to be upgraded continuously and that re-investment is very critical.
FEA chairman Nizam-ud Dean says the profit recorded for last year was largely due to the commissioning of the Nadarivatu Hydro Project which produced around 98.9 million units of energy and stringent measures implemented to control operation expenditure.