Centum defies bearish market to post steady earnings
Centum Investment released its half year performance to 30 September 2011 against a backdrop of significant deterioration of key macro economic fundamentals and significant weakening of capital markets.
The key highlights of the performance are:
i) Group Profit Before Tax was Kshs 828 Million a slight drop from Kshs 837 Million in the comparable prior period;
ii) Diluted net asset value per share was maintained at Kshs 18.77 down from Kshs 18.87 in March 2011.
iii) A major reduction in the Company’s investment on the stock market from 24% of total assets to 9% of total assets.
iv) A significant increase in the cash holdings of the company from 0% of total assets to 11% of total assets.
v) A 27% reduction in borrowings.
Centum Chief Executive Officer explained that following the dramatic changes in key economic fundamentals, the focus of the Company over the last six months was firstly protecting the value that had been created over the last two years, when the total assets and shareholder capital more than doubled. Secondly, position the Company to take up the opportunities that will emerge in the current difficult economic environment. The objectives of the Company were therefore on five key areas:
- Value protection;
- Reduction of exposure to the stock market;
- Reduction of borrowings;
- Enhancement of cash holdings; and
- Focus on developing new growth opportunities
The last six months have seen a significant decline in asset prices and a major increase in the cost of money. The Chief Executive added that these two factors had significantly altered the investment landscape and presented compelling opportunities for investors with cash to deploy. James Mworia, said: "We took advantage of the opportunity early in the start of the period to dispose the bulk of our listed assets at attractive prices before the market prices declined. We are currently holding more than Kshs 1.7 Billion in cash and cash equivalents and we have several hundred million in available debt facilities. Centum is well placed to take advantage of the opportunities that this environment is unearthing.”
In line with the Company policy during this strategic period ending March 2014 the Company does not recommend the payment of a dividend.
James Mworia
Managing Director
For further information contact Kingori Choto, Ogilvy PR, on kingori.choto@ogilvy.co.keor 0726-298780