KenGen Reduces FY2026 Shareholder Dividends to KES 0.75

Kenya Electricity Generating Company (KenGen) has proposed a 16.7 percent cut in its final dividend to KES 0.75 per share for the financial year ended June 30, 2026, down from KES 0.90 per share distributed in the prior fiscal period.

The dividend adjustment—representing the first reduction after two consecutive years of increased payouts—follows a modest 1.2 percent dip in profit after tax to KES 10.35 billion, alongside a strategic push to divert operational cash flows toward expanding renewable energy infrastructure and reducing outstanding long-term liabilities.

Despite the lower shareholder payout, KenGen recorded strong top-line revenue growth, rising 6.4 percent to KES 59.7 billion.

The company supplied a record 8,975 GWh to the national grid amid soaring peak electricity demand, which hit 2,549 MW.

However, operating expenses escalated by 6.8 percent to KES 37.5 billion, while net cash from operating activities dropped from KES 39.6 billion to KES 30.8 billion, tightening near-term liquidity for equity distributions.

Managing Director and CEO Peter Njenga emphasized that the capital allocation shift prioritizes long-term enterprise health, pointing to a KES 12.2 billion reduction in total borrowings down to KES 97.1 billion.

By lowering finance costs by 12.1 percent and self-funding expanding geothermal and solar projects, KenGen aims to strengthen its debt service coverage and bolster generation capacity without relying heavily on expensive commercial debt.

The dividend decision underscores a disciplined balance between delivering baseline equity returns and funding capital-intensive energy transitions.

As KenGen stock maintains an estimated forward yield of 6 percent, the company’s financial recalibration sets a key benchmark for corporate capital structure management, infrastructure reinvestment, and fiscal prudence on the Nairobi Securities Exchange.

https://x.com/thekenyatimes/status/2115811923019129280?a=utq6Q5TKOW4hIwt-voM&s=20

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