Centum Investment Plc has announced the extension of its share buyback program, which was initially launched on February 6, 2023. The initiative aims to repurchase up to 10% of the company’s issued and fully paid share capital.
Initially approved for an 18-month period, set to conclude on August 2, 2024, the program’s objective is to stabilize Centum’s market value and share price. So far, Centum has bought back 9.8 million shares, with the approval to repurchase up to 66.5 million shares. The shares have been acquired at prices ranging from a maximum of KES 9.0 to a minimum of KES 0.5, amounting to a total of KES 600.9 million.
Share buybacks reduce the number of shares in circulation, which in turn can increase the company’s market valuation and the ownership stakes of remaining shareholders. In February 2023, Centum CEO James Mworia stated that the buyback would benefit long-term shareholders by enhancing the net asset value per share and providing liquidity in a sluggish market.
The Capital Markets Authority has granted approval for the program’s extension from August 5, 2024, until Centum’s next Annual General Meeting, scheduled for September 20, 2024. During this meeting, shareholders will have the opportunity to vote on whether to continue the buyback program.
Centum recently reported a notable 135.6% increase in profit after tax, reaching KES 2.6 billion for the financial year ending March 31, 2024, compared to a loss of KES 7.3 billion in the previous year. This improvement was driven by significant profit growth in the real estate sector, gains from the Two Rivers Special Economic Zone, and reduced losses in investment operations.
As a result of this performance, the company has proposed a final dividend of KES 0.32, pending shareholder approval.
CEO James Mworia also outlined Centum’s new strategic phase, Centum 5.0, which focuses on maximizing the value of its current investment portfolio. The company plans to scale and monetize its businesses to at least match their carrying values.
On the Nairobi Securities Exchange, Centum, trading under the ticker symbol CTUM, closed its last session at KES 8.94, reflecting a year-to-date gain of 1.4%.
