Sunday, July 7, 2024 10:44 AM
Saif Power Limited's Resilience Amid Financial Challenges
- SPWL faced revenue decline in 2019, but net profit rose.
- COVID-19 caused a 35% drop in SPWL's net profit in 2020.
- SPWL saw an 83.69% revenue surge in 2021 post-pandemic.
Image Credits: brecorderSaif Power Limited, a leading power company in Pakistan, navigated through financial challenges, including revenue declines in 2019 and the impact of COVID-19 in 2020. However, the company showed resilience with a significant revenue surge in 2021, reflecting its strategic decisions for sustainability and growth in the power sector.
Established in 2004, Saif Power Limited (PSX: SPWL) is a prominent publicly listed company in Pakistan, operating a 225 MW combined cycle power plant since 2010. The company supplies electricity to Central Power Purchasing Agency Guarantee Limited (CPPA-G) and has 386.47 million shares held by 6760 shareholders as of June 30, 2023. Majority ownership lies with associated companies, local public, banks, and insiders.
In 2019, SPWL faced challenges with a decline in net generation and revenue, offset by cost reductions and insurance recovery. Despite increased operating profit, finance costs rose, but net profit saw a 20.34% rise. The COVID-19 pandemic hit SPWL in 2020, causing a drop in net sales and gross profit, leading to a 35% decrease in net profit.
However, 2021 brought a significant revenue surge of 83.69% as economic activities resumed. While power generation improved, operational costs surged, impacting gross profit. Notably, other income increased due to higher investment returns and insurance claims.
SPWL's financial performance reflects market conditions, operational hurdles, and external events. The company's resilience and strategic decisions are crucial for its sustainability and growth in the power sector.
