Umeme Limited has reported a net loss of sHS511 billion for the year ended December 31, 2024, marking it a challenging final year in its 20-year electricity distribution concession in Uganda.
The concession reached its natural end in March 2025, triggering a complex transition process that significantly impacted the company’s operations and financial performance.
“This is the 20th year of the Company’s Electricity Distribution concession in Uganda. The concession reached the end of its natural term in March 2025,” the Board of Directors stated in the company’s audited financial results.
Throughout 2024, Umeme focused on critical transition processes involving staff, ICT systems, distribution assets, and service continuity. These activities, coupled with the pending recovery of outstanding claims from the government, weighed heavily on the company’s bottom line.
“The effects of the concession end, transition processes and outcomes have had a significant adverse impact on the overall performance of the Company,” the Board said. “The effects were notably in the form of lower staff productivity levels, increased operating costs and significant provisions in relation to financial assets pending final determination.”
The macro-operating environment added further pressure, with inflation, regulatory constraints, and rising financing costs taking a toll. Safety remained a top priority, though the company registered 18 fatal accidents linked to unauthorized power usage, poor domestic wiring, and vandalism.
Despite the headwinds, electricity demand grew by 10.8% to 4,674 GWh, driven by increased grid connections and economic activity. A total of 219,656 new customers were connected in 2024, pushing the total to 2.2 million. Energy losses dropped to a historic low of 16%, a marked improvement from 38% at the start of the concession in 2005.
Operating costs per kilowatt-hour sold rose by 18.2%, reflecting expanded operations and end-of-concession activities. The company also completed critical infrastructure projects, including upgrades to substations in Hoima and Jinja, and installation of dedicated lines to regional referral hospitals.
On the digital front, Umeme rolled out a new Yaka Management System in December 2024, integrating various billing and customer service platforms.
“The system further enhances the customer experience, revenue protection and staff productivity,” the company noted.
Revenues grew by 5.4% to Shs2.3 trillion, bolstered by a 10.8% rise in electricity sales volume. However, the company made provisions amounting to Shs329 billion for disputed financial assets related to the Buyout Amount claim under its concession agreement with the Government of Uganda.
“In accordance with IFRS Accounting Standards, we provided for the unadmitted and disputed component of the Buyout Amount,” the Board stated. “The Company resolved to recover this amount through the arbitration process to be conducted in London, United Kingdom.”
With increased amortization costs of Shs699 billion and expected credit losses soaring from Shs1.6 billion to Shs361 billion, Umeme’s total assets dropped from Shs2.35 trillion in 2023 to Shs1.39 trillion in 2024. Finance costs declined by 35% to Shs29 billion following the full repayment of term loans in 2023.
“The income tax charge for the period was a credit of Shs92 billion compared to a charge of Shs3.9 billion in 2023,” the report noted.
The report added, “The credit in 2024 was due to the loss incurred by the Company due to the provisions noted above.”
No dividend has been declared for 2024, a reversal from the previous year’s payout of Shs54.2 per share.
Following the formal handover of the distribution network to the Uganda Electricity Distribution Company Limited (UEDCL) on March 31, 2025, Umeme is now pursuing recovery of the remaining Buyout Amount.
“As communicated in the public notice of 2nd June 2025, the Company is seeking to recover the balance of the outstanding Buyout Amount payable to it in the sum of $292 million (Shs1,051 billion) plus contractual interest, through the international arbitration route,” the Board affirmed.
