Power generating company, Geregu Power Plc, said it made advance payments of N8.783bn to Italian firm, Ansaldo Energia, for the overhaul of its gas turbine as of the end of June 2023.
This was disclosed in the unaudited interim statement of financial position of the Genco for the period ending June 30, 2023, which was filed with the Nigerian Exchange Limited.
As of December 2022, advance payment to the Italian firm was N4.616bn.
In April 2022, Ansaldo Energia signed a three-year contract with Geregu valued at €32m to conduct a major overhaul of the 435 MW Power power plant in Ajaokuta, Kogi State, Nigeria.
The three-year contract included the supply of spare parts which would be entirely manufactured by Ansaldo Energia in Italy, and the maintenance services, which would be performed by its subsidiary Ansaldo Energia Nigeria, based in Lagos. Activities would start in early 2023.
According to Geregu’s financials, the major overhaul of the gas turbine was scheduled for Q3, 2023.
Based on reports, this contract marked Ansaldo Energia’s first foray into the electricity sector of Nigeria. For Geregu Power, this represents the second major overhaul since the acquisition of the plant by Amperion Power Distribution.
Geregu on Friday released its second quarter (Q2), financial statement showing a 34% jump in revenue from energy sold, and capacity charge. Its stock trading on the NGX rose 6.45% to a new 52-week high as investors cheered the announcement of a partnership with the Lagos State Government, the State Grid Corporation of China and the African Development Bank (AfDB).
For the 3-months period to June 2023, revenue for the energy giant stood at N20.465 billion, while gross profit rose by 48.5% to N11.175 billion.
Other positives for the quarter include a reduction in receivables due from related party Amperion Power Distribution Company Ltd, to just N6.9 billion as a total of N31.58 billion was paid to Geregu Power.
Overall, trade receivables fell by 22.4 percent to N59.633 billion.
Geregu remained in solid liquidity position as its cash and cash equivalents for the period stood at a healthy N44.3 billion.
Geregu earns more interest than it pays, so coverage of interest payments is not a concern.
The firm repaid N35.82 billion in long term borrowings helping to cut its outstanding term loans by 47% to N17.363 billion. The outstanding amount is a N17billion facility types 1 to 2 from First Bank Ltd at 20% interest rate to augment working capital and finance major overhaul.