Saudi Electricity profit rises 25%

Saudi Electricity Co, the state-controlled power producer, said second-quarter profit increased 25 per cent, helped by higher government tariffs and more energy demand in the Arab world's biggest economy. Net income rose to 1.34 billion riyals (Dh1.31 billion), from 1.07 billion riyals a year earlier, the Riyadh-based company said in a statement yesterday. The average estimate of three analysts was for profit of 1.29 billion riyals, according to data compiled by Bloomberg. Saudi Arabia is developing electricity projects to keep pace with a swelling population and accelerating economic growth spurred by government spending. Power demand in the world's largest oil exporter will increase 8 per cent a year, according to government estimates. Saudi Arabia, the world's biggest oil supplier, revised electricity rates for the government, industrial and commercial sectors in July. The increase in Saudi Electricity's profit was due to the tariff adjustments and the "amount of energy sold", the utility company said in the statement. Second-quarter operating profit rose 27 per cent to 1.24 billion riyals, according to the statement. Six-month earnings per share were 0.13 riyal, compared with 0.07 riyal a year earlier, the company said, without giving a three-month figure. Saudi Electricity predicted that it will have a customer base of 7.9 million by the end of 2016. The company will add 6,510 megawatts of capacity this year. To finance the additional capacity, Saudi Electricity is tapping banks and the government for loans. The utility signed a $989.1 million (Dh3.63 billion) agreement with banks in June to finance the purchase of equipment to expand a power facility. In the same month, the government said it would provide a 51.1 billion-riyal loan without interest. From / Gulf News