In Summary
- Allan Walmsley, the managing director of the tyremaker said, that the company was looking to nurture its niche products in the region and grow export sales significantly this year.
- The company expects to open its Burundi subsidiary which will have a retail tyre centre and a depot, on June 15, and that this subsidiary, together with the one in Uganda and Tanzania are expected to contribute at least 20 per cent of revenues.
Sameer Africa has set it sights on the Somalia and Nigerian markets.
Allan Walmsley, the managing director of the
tyremaker said, that the company was looking to nurture its niche
products in the region and grow export sales significantly this year.
Sameer already supplies tyres to defence forces in
the region after it launched the Yana Jeshi Extra 1400-20 tyre last
year for sale to the Kenya Defence Force in Somalia.
“From studies, the market certainly exists. We are
looking at Somalia … we just came back from Nigeria and hopefully in
August we will do our first shipment. Export markets are already up 60
per cent this year,” said Mr Walmsley.
He said that the company expects to open its
Burundi subsidiary which will have a retail tyre centre and a depot, on
June 15, and that this subsidiary, together with the one in Uganda and
Tanzania are expected to contribute at least 20 per cent of revenues.
The Burundi subsidiary will be used to re-export
to Eastern DRC while the company is also looking at increasing its
export sales to Zambia, Zimbabwe and Ethiopia.
READ: Sameer Africa to open new subsidiary in Burundi
READ: Sameer Africa to open new subsidiary in Burundi
Other export markets are expected to contribute another 20 per cent, bringing the total contribution of the non-Kenya subsidiaries and export markets to 40 per cent.
Sameer has faced rising production costs and
increased competition from cheap imports in the tyre market, threatening
its revenues.
A rise in players in the tyre market since 2005,
when Kenya cut import duty from 25 per cent to 10 per cent under the
East African Community common external tariff, has worsened the
situation.
While overall revenues and profits have been
rising over the past three years, the Tanzania and Uganda units have
been struggling to maintain momentum.
Combined revenues for the tyre maker rose
marginally by 7.8 per cent to Ksh3.96 billion ($46.04 million) for the
year ending December 2012 from Ksh3.67 billion ($43.2 million) the
previous year.
Group profits
The group’s net profits almost doubled to
Ksh189.75 million ($2.2 million) from Ksh96.94 million ($1.1 million)
during the same period the previous year.
Revenues from the Tanzania subsidiary dropped by 20.6 per cent to Ksh487.27 million ($5.6 million) during the period ended December 2012 from Ksh613.88 million ($7.2 million) in December 2011 while profits attributable to the parent company fell sharply by 40.4 per cent to Ksh11.69 million ($135,885) from Ksh19.62 million ($230,709) over the same period.
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