A section of Sameer Business Park. FILE PHOTO | NMG
Sameer Africa's net profit for the year ended December 2023 declined by 53.7 percent to Sh46.3 million, weighed down by the weakening of the shilling against the dollar.
Net earnings dropped from Sh100.3 million, extending the dividend drought for investors who have seen the firm diversify from tyre selling to real estate in a bid to revive the fortunes of the Nairobi Securities Exchange-listed firm.
Its investors will have to endure the tenth consecutive year without dividends. The last time the firm paid a dividend was for the year ended December 2013 when investors got Sh0.3 per share.
Net finance costs, which refers to spending on servicing debts, rose by 98.5 percent to Sh140.79 million from Sh70.9 million, coming in the year the Kenya shilling shed a quarter of its value against the dollar. The weakening of the shilling inflated foreign-denominated debts while also making imports costly.
“The group’s earnings reduced by 54 percent…mainly due to unrealised foreign exchange losses arising from the weakening of shilling against the United States dollar,” said the firm.
The firm had in December last year issued a profit warning, saying that depreciation of the Kenya shilling against major currencies had seen the company incur “substantial foreign exchange losses” arising from the translation of foreign-currency-denominated liabilities.
The year ended December 2023 also saw Sameer’s revenue drop 36.3 percent to Sh390.5 million while operating expenses rose by 2.4 percent to Sh148.9 million, adding to the dip in net earnings.
It said operating profit declined by 6.5 percent despite a 36 percent reduction in revenue, with the company attributing this to the implementation of strategies to grow earnings generated from the property division.
→ palushula@ke.nationmedia.com
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