Khanikhola Hydropower Q4 Results: Stable Revenue but Continued Losses Pressure Financial Health

Khanikhola Hydropower Co. Ltd. (KKHC) has published its audited financial results for the fourth quarter of FY 2024/25, showing revenue stability but persistent bottom-line losses. The company reported a total revenue of Rs. 56.04 million in Q4, the same figure maintained across all four quarters of the fiscal year. Compared to Rs. 131.74 million in Q4 of 2023/24, this represents a steep year-on-year decline of 57%, underscoring reduced electricity generation or sales.

Interestingly, KKHC maintained a gross profit of Rs. 56.04 million, with a 100% gross margin across all quarters. This implies that revenue was directly recorded as gross profit without accounting for additional cost of sales, which is typical in hydropower reporting where most costs are linked to financing, depreciation, and operations rather than variable production.

Despite the steady top line, net income remained in negative territory at Rs. -34.99 million in Q4, although this was an improvement compared to Q3’s deeper loss of Rs. -49.21 million. The net profit margin stood at -62.44%, reflecting the significant impact of financial and administrative expenses. In contrast, Q1 had posted a positive net income of Rs. 15.93 million, highlighting volatility in earnings across the year.

The company’s return metrics also stayed weak. Return on Assets (ROA) was reported at -3.15%, while Return on Equity (ROE) deteriorated further to -9.80%, compared to -6.60% in Q4 of the previous year. This signals continued erosion of shareholder value.

On a per-share basis, EPS (annualized) stood at -7.51, improving slightly from -14.09 in Q3, but still negative compared to Rs. 13.68 in Q1. The reported PE ratio remained negative at -38.78, reflecting the company’s loss-making status.

From a balance sheet perspective, book value per share was Rs. 73.02, lower than Rs. 79.81 a year earlier, suggesting gradual capital erosion. However, the stock’s market value per share traded at Rs. 291.34, well above book value, showing that investors still assign a premium to the company’s long-term hydropower prospects despite near-term losses.