Centum Investment Company reported a remarkable growth in its profits for the six months of last year, with earnings surging nearly twentyfold to Sh244 million.
This impressive performance stands in stark contrast to the Sh12 million reported during the same period the previous year.
The company’s improved performance can be attributed to several factors, including enhanced operational efficiencies, the absence of impairment provisions, and a reduction in finance-related expenses.
Notably, Centum did not acquire any additional debt during this period and maintained a favorable cash position after accounting for debt, cash holdings, and the marketable securities portfolio.
As of last year, the total debt amounted to Sh4.2 billion, resulting in a gearing ratio of 10 percent. Additionally, the company experienced a 45 percent increase in dividend income during this period.
However, despite these positive developments, the consolidated profit after tax saw a decline of Sh594 million.
This decline was primarily driven by unrealized foreign exchange losses due to the depreciation of the Kenyan Shilling relative to the US Dollar and Ugandan Shilling.
Consequently, the company recorded a consolidated income loss of Sh1.2 billion, a significant increase from the Sh283 million loss reported in the same period the previous year.
The consolidated performance reflects the combined results of subsidiaries, associates, and joint venture investments across five distinct business segments.
These segments encompass Trading Businesses, Financial Services, Centum Real Estate, Two Rivers, and Investment Operations.
Centum Real Estate continues to demonstrate strong operating cash flows, driven by the sale of development rights and residential units.
To date, the business has returned Sh5.2 billion out of Centum’s total investment of Sh7.5 billion.
Furthermore, Centum Real Estate recently entered into additional sale contracts for development rights totaling Sh3.6 billion, which will contribute to further cash distributions to Centum.
The residential units sold or under development represent 85 percent of the total projects, with an embedded and distributable value of Sh4 billion upon completion.
Conversely, Two Rivers Development experienced a loss of Sh984.4 million during the period, compared to Sh342.3 million in the previous year.