The audited financial statements of Ghana Water Company Limited (GWCL) for the year ended 31 December 2019, have revealed that the state-owned utility company made a huge loss.
In terms of financial performance, the company’s operations for the year ended with a loss of GH¢1,885,166,215 compared with a profit of GH¢35,766,522 recorded in 2018.
This represented a decrease of 5,370.76% in the company’s financial performance.
Also, total income for the year amounted to GH¢925,816,620 as against GH¢934,027,490 recorded in 2018, a drop of 0.9% over 2018.
The decrease was mainly due to a fall in revenue from GH¢914,660,494 in 2018 to GH¢901,957,013 in 2019, representing 1.4%.
Total expenditure, however, increased by 120.5% from GH¢1,576,595,352 in 2018 to GH¢3,475,550,806 in 2019.
The general administration and other costs rose by 544.1% from GH¢342,715,084 in 2018 to GH¢2,207,528,665 in 2019.
Meanwhile, the company’s non-current assets decreased by 5% from GH¢12,509,361,655 to GH¢11,878,889,710 in 2019.
The decline was mainly due to the depreciation charged for the year.
GWCL’s current assets also dropped significantly by 33.9% from GH¢1,125,926,385 in 2018 to GH¢743,571,859 in 2019.
The variation was a result of a decrease in mainly account receivables, which dropped from GH¢926,631,311 in 2018 to GH¢540,784,041 in 2019, representing 41.6%.
Current liabilities, on the other hand, went up by 22.8% from an amount of GH¢1,259,471,699 in 2018 to GH¢1,547,167,843 in 2019.
The increase was due, mainly, to a 329.8% rise in current portions of long-term loans.
Non-current liabilities also recorded a rise of 322.6% from an amount of GH¢934,500,551 to GH¢3,949,643,239 in 2019.
The increase was due, mainly, to a 329.8% (GH¢3,015,142,688) surge in long-term loans from GH¢934,500,551 to GH¢3,949,643,239 in 2019.
The current ratio deteriorated from 0.89:1 in 2018 to 0.48:1 in 2019, an indication of the company’s inability to meet its short-term financial obligations when they fall due.