Islamabad: Altern Energy Limited, a prominent player in Pakistan's energy sector, announced significant operational challenges in its Annual Report for 2025, citing a lack of dispatch demand and the early termination of key agreements with the government. The company's financial stability, which has been significantly bolstered by dividends from its subsidiary, Rousch (Pakistan) Power Limited (RPPL), is now under scrutiny following RPPL's decision to hand over its power generation complex to the government.
According to the report, Altern Energy has been grappling with reduced capacity revenue due to a notable decline in demand from the National Power Control Center (NPCC). This has severely impacted the company's ability to fulfill its contractual obligations with the Central Power Purchasing Agency (CPPA), its sole customer. The challenges were exacerbated when RPPL, the primary contributor to Altern Energy's financial viability, signed a Negotiated Settlement Agreement (NSA) for the termination of its Power Purchase Agreement (PPA) and other related agreements with the government. As a result, RPPL transferred its power generation complex to the National Power Parks Management Company Limited (NPPMCL) by the end of 2024, ceasing its electricity generation operations.
The company's financial statements revealed a gross loss of Rs. 95.29 million for the fiscal year ending June 30, 2025, compared to a gross loss of Rs. 93.37 million the previous year. Despite this, Altern Energy reported an unconsolidated net profit of Rs. 5,791.44 million, a significant rise from Rs. 4,336.31 million the prior year, primarily due to dividend income from its subsidiary PMCL. Consolidated earnings for equity holders were Rs. 4,361.48 million, with earnings per share (EPS) increasing to Rs. 12 from Rs. 8.49 in the previous year, reflecting a substantial improvement.
According to information available from the Pakistan Stock Exchange (PSX), Altern Energy's financial performance demonstrates a moderate move with earnings per share rising from Rs. 11.95 to Rs. 15.94. However, the company's turnover remained nil for the second consecutive year, with operating costs increasing slightly.
The Board of Directors has sought early termination of the PPA, Implementation Agreement (IA), and Government Guarantee to mitigate further losses, a move approved by shareholders on April 17, 2025. The management is actively pursuing resolution with government entities to curtail additional financial strain on shareholders.
Looking ahead, Altern Energy's viability as a going concern hinges on receivables from RPPL, which are deemed sufficient to sustain operations despite the cessation of RPPL's electricity generation capabilities. The company's commitment to risk management remains steadfast, employing a robust Enterprise Risk Management framework to navigate operational and financial uncertainties.
As per corporate governance mandates, Altern Energy's financial transparency and adherence to the listed companies' regulations have been maintained, with no significant doubts regarding its ability to continue as a going concern. However, the gender pay gap reported a mean and median gap of 100%, highlighting the absence of female employees and underscoring the company's pledge to equal pay for equal work without gender disparity.
The energy sector's challenges continue to pressure Altern Energy, as it navigates the complexities of operational sustainability amidst shifting government and market dynamics.