Centum sinks into a Ksh.2 billion half-year loss

Investment firm Centum Group has sunk into a Ksh.2 billion loss in six months of operations to September 30 from a profit of Ksh.6.8 billion at the same time last year.

The loss position is largely attributable to a substantive hit on two of the Group’s private equity investments including publisher Longhorn and airline catering company Nas Servair.

The latter suffered from reduced air travel in the second and third quarters of the year while Longhorn publishers’ sales were hit by the extended school closures.

Combined, sales from Centum’s trading business were down 96 per cent at Ksh.294.9 million from Ksh.4.8 billion with the firm booking a Ksh.403.9 million trading loss.

Income from financial services was meanwhile flat at Ksh.1.9 billion while investment income slid to Ksh.433.5 million from Ksh.12.4 billion.

The dip in investment income was largely from the lack of new asset disposals in comparison to Ksh.12.4 billion in gains made at the same time last year from its sale of beverage assets in 2019.

Centum’s private equity business subsequently made a Ksh.1.2 billion loss from a gain of Ksh.8.4 billion last year dragging down the Group’s entire earnings in the period.

Going forward, the company has backed its stronger balance sheet which follows substantive debt clearance in the last financial year to allow it take advantage of emerging opportunities in both private equity and marketable securities.

Earlier in the year, Centum retired a four-year bond reducing its net debt by Ksh.4.1 billion to cut off part of financing costs from its balance sheet.

The company is meanwhile set to continue pursuing the sale of bulk land and residential properties within its real estate portfolio managed under Centum Real Estate Limited.

Following the slump into loss making, Centum’s basic earnings per share has fallen to a negative Ksh.2.09 from a higher Ksh.10.70 last year.