RIYADH, 20 April 2003 — The Saudi Electricity Co., formed from the merger of 10 loss-making power firms, posted yesterday a net loss of $90.1 million in the first quarter of 2003.
SEC, the third largest listed company in Saudi Arabia, said losses in the first three months of the year had improved by 17.8 percent from a loss of $109.6 million during the same period of 2002. The company controls the entire power generation and distribution sector of Saudi Arabia and was listed on the Saudi stock exchange in May 2002, two years after its formation.
The losses are essentially the result of a drastic drop in the consumption of electricity during the winter months.
SEC ended 2002 with a net profit of $270.4 million after registering a loss of $182.9 million in the first half of the year, mainly owing to high power consumption during the hot summer months. In 2001, the company posted net income of $207.7 million.
The Saudi electricity sector has been undergoing a major restructuring with the establishment of SEC in 2000 seen as a prelude to full privatization, and a new authority to regulate the interests of consumers, operators and investors. Before SEC’s creation, the total outstanding debt of the Saudi power sector had reached $26 billion.
The Kingdom estimates its electricity sector will need investments of more than $117 billion up to 2020, as the population is projected to more than double to 38 million.
