GOOD rainfall and the implementation of the final phase of tariff increase were contributing factors to the success and profitability of the country's sole electricity supplier.
But despite the good profitability level Fiji Electricity Authority achieved last year, the company's working capital remained at a vulnerable level, chief executive officer Hasmuskh Patel said.
The $3.4 million cash balance that remained at the end of last year was equivalent to one week's fuel cost at the prevailing fuel price of 2011, he said.
"FEA is still faced with the mammoth task to build new energy capacity to cater for increased demand of electricity and maintaining existing assets which are considered its golden goose," Mr Patel said.
FEA chairman Nizam-u-Dean said it was important that government continued to support FEA to ensure the long-term financial sustainability of the organisation.
Meanwhile, Mr Patel said in his chairman's report - contained in the company's 2011 annual report - the average cost of producing a unit of electricity from diesel was in excess of 40 cents per unit last year.
"The positive financial performance enabled FEA to carry out capital expenditure works totalling $112 million and repay matured bonds amounting to $17 million in 2011. The capital expenditure of $112 million is one of the highest achieved in FEA's history," he said.
He added that it was the result of work from previous years that were deferred because of poor financial performance that resulted from low electricity tariff.
Prolonging the replacement and upgrade work on key assets would put the entire power system at risk, Mr Patel said.