Lahore: The Board of Directors of Pakgen Power Limited has announced the early termination of its Implementation Agreement, Power Purchase Agreement, and Guarantee with the Federal Government of Pakistan. The agreements, initially set to expire on October 7, 2028, were terminated effective January 31, 2025, following shareholder approval on January 27, 2025.
During the quarter ending March 31, 2025, Pakgen Power Limited dispatched 5,938.6 MWh of electricity to the Central Power Purchasing Agency (Guarantee) Limited, a significant decrease compared to the 58,182 MWh dispatched in the same period the previous year. The company's net profit for the quarter was Rs 37.40 million, a substantial decline from Rs 1,853.50 million in the comparable period of the previous year, resulting in earnings per share of Rs 0.10 compared to Rs 4.98 previously.
According to information available from the Pakistan Stock Exchange (PSX), the company maintains a strong financial position with investments in mutual funds and cash and bank balances totaling Rs 18.70 billion as of March 31, 2025. These funds are intended to support daily operations and future participation in the Competitive Trading Bilateral Contracts Market (CTBCM). The CTBCM, once implemented by the Government of Pakistan, will allow the company to operate as a merchant plant, selling electricity to bulk consumers and distribution companies through wheeling arrangements.
To address the financial implications of the agreement terminations, Pakgen Power Limited has implemented several cost reduction measures, including a Voluntary Severance Scheme for employees and optimization of plant maintenance costs. The power plant is currently in preservation mode to ensure readiness for future electricity demand. The company is also exploring new business ventures to utilize its available funds, with such plans to be presented to shareholders for approval following board recommendations.
The board expressed appreciation for the management's efforts in maintaining a productive work environment and commended the dedication and commitment of executives and staff members.