Uganda’s electricity distributor Umeme Limited has issued a profit warning, signaling that the company expects to record a loss for the financial year ending 31 December 2025, as it prepares for life after the expiry of its 20-year electricity distribution concession.
In a public notice dated 29 January 2026, Umeme’s board of directors said the anticipated loss follows an assessment of the company’s financial performance for the year and reflects structural changes triggered by the end of its concession on 31 March 2025.
The announcement marks Umeme’s second consecutive annual loss and underscores the financial pressures facing the company after the cessation of its core electricity distribution operations in Uganda.
According to the notice, Umeme incurred a loss for the year ended 31 December 2024 and expects to register another loss for the 2025 financial year.
The company attributed the outcome primarily to the cessation of operating revenue generation at the end of the first quarter of 2025, following the natural expiry of its concession.
Umeme’s electricity distribution concession, which began in 2005, formally ended on 31 March 2025 after 20 years. Since then, the company has not generated revenue from electricity distribution, historically its sole and primary source of income.
The transition marked a significant shift in Uganda’s power sector, with the government assuming responsibility for electricity distribution through a successor arrangement.
While Umeme had long warned investors of the financial implications of the concession’s expiry, the profit warning provides the clearest indication yet of the depth of the impact on the company’s earnings.
The board said it was issuing the profit warning to inform shareholders, prospective investors and the general public, in line with regulatory requirements and market disclosure standards.
The warning follows earlier communication at the company’s Annual General Meeting held on 18 July 2025, where Umeme cautioned that it was likely to post a loss for the 2025 financial year.
At the time, management cited uncertainty around post-concession revenue streams and unresolved compensation claims.
Umeme has been one of the most closely watched companies on the Uganda Securities Exchange, given its role in a strategic national sector and its significant local and foreign shareholder base.
A central issue in Umeme’s post-concession future remains its outstanding claims against the Government of Uganda. Under the terms of the original Privatization Agreement, the company is entitled to compensation for unrecovered investments made during the concession period.
In the notice, Umeme said it continues to actively pursue these claims through an ongoing dispute resolution process, as previously disclosed to the market.
Umeme said further details on its financial performance and the basis for the anticipated loss would be provided in its annual report and audited financial statements for the year ended 31 December 2025.
The developments come at a time of transition for Uganda’s electricity sector, which has undergone major reforms aimed at improving efficiency, expanding access and attracting investment.
Umeme played a central role in the sector for two decades, overseeing network expansion, loss reduction and customer growth.
While the long-term impact of the concession’s end on service delivery and tariffs remains under assessment, Umeme’s financial struggles highlight the commercial risks associated with time-bound infrastructure concessions in emerging markets.
In its notice, the board reiterated its commitment to transparency and regulatory compliance, emphasizing that shareholders would be kept informed of any material changes.
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