UMEME Used to Power Uganda – Can It Be Salvaged Through Court?
UMEME was a household name in Uganda from the year 2005, with its Yaka brand of pre-paid electricity distribution. After seven years, UMEME listed on the USE in 2012 at an Initial Public Offer (IPO) of UGX275/share. However, the 20-year electricity concession agreement expired on 31 March 2025. At the peak of its financial performance, the UMEME share price on the Uganda Securities Exchange (USE) was UGX405/share. As of October 2026, that price is UGX63/share.
What has happened in the past 18 months after the concession expired?
For the year ended 31 December 2025, UMEME earned revenue for only three months (January-March 2025). Its revenue declined from UGX2.3trillion in the year 2024 to UGX0.5trillion for the year 2025. Its gross profit margin declined from 36% in 2024 to 19% in 2025. This means that economies of scale had begun to dissipate. With some costs remaining fixed, UMEME registered a net loss for the year 2025 of (UGX224billion).
The external auditors (the Uganda Auditor General) noted that there was uncertainty that UMEME was a going concern due to negative shareholder’s equity of (UGX353billion). On the hand, the Board of Directors were confident that UMEME would continue in operations in the foreseeable future. Indeed, the company continued in operations but posted very minimal revenue for the first six months of the year (January-June 2026). Its shareholder’s equity remained in a negative position at (UGX380billion).
What is UMEME waiting for in the second half of 2026 and beyond?
There is an arbitration case at the London Court of International Arbitration (LCIA). In June 2025, UMEME has filed a compensation claim of about UGX1trillion against the Government of Uganda (GOU). If the case goes in favour of UMEME, the amount could reach UGX1.6trillion, inclusive of damages and interest.
However, UMEME cannot record such an amount its financial statements as a “contingent asset” because it would be contrary to International Accounting Standard (IAS 37). No one know how the case will end, and when.
What if UMEME wins the London case?
UMEME has approximately 1,624million ordinary shares listed on the USE. If the UGX1.6trillion is successful, the shareholder’s equity would be a positive UGX1.22trillion. If we divide this by the number of ordinary shares, the net asset value would be UGX750/share. This would be good news for UMEME shareholders, but bad news for GOU.
