Business / News
Wednesday, 29 Mar 2017 12:32 EATcgitau@kenyafreepress.com
Petroleum company Total Kenya has announced an increase of 50.3 percent in pre-tax profit of Sh3.94 billion for the year ended December 31, 2016. The rise in pre-tax profit from Sh2.62 billion reported at the end of 2015 has been driven by prudent cost management and sustained operational efficiency.
“The improved financial performance has mainly been driven by action plans set by management to grow the business in all segments, effective management of working capital requirements, costs, cash, and investments in safety and profitable business ventures,” said Total Kenya Managing Director Anne-Solange Renouard.
The listed firm on the Nairobi Securities Exchange said its total assets increased from Sh34.22 billion in 2015 to Sh36.18 billion last year. Profit after tax increased by 38 percent from Sh1.62 billion in 2015 to Sh2.23 billion.
The drop in international oil prices led to a decrease of 26 percent in net sales. The effective cost of sales management and stronger focus on more profitable business segments in 2016 led to increase in gross margins by 12 percent from Sh6.99 billion in 2015 to Sh7.85 billion last year.
The leading oil and gas marketer in the country said other income increased by Sh197 million as a result of growth in rental income and non-forecourt activities. “As a key objective set by management, operating expenses were closely managed and were controlled at below inflation growth. Net finance income grew by Sh36 million resulting from effective cash management,” Anne-Solange Renouard said at her office at Regal Plaza along Limuru Road.
Due to the stability of the Kenya shilling against the US dollar, the forex loss was lower at Sh22 million compared to Sh320 million in 2015. Investments in long-term assets totalling to Sh1.54 billion were made in the year, in line with the strategy to develop the business in the core activities and to continue to tap on business opportunities. This was done in full compliance with the safety and environmental requirements and standards.
She said the macro-economic environment remained quite stable last year compared to the volatile 2015 with both petroleum prices and the Kenyan shilling contributing to the stability.
The Directors have recommended the payment of a first and final dividend of Sh1.06 per share for the year compared to Sh0.77 per share paid in 2015. This proposed payout represents an increase of 38 percent as compared to 2015 and is subject to the shareholders approval at the 63rd Annual General Meeting to be held on June 16, this year.
With Kenya’s economic growth expected at around 6 percent in 2017, the Board is confident that the company is well placed to take advantage of business opportunities owing to sustained investments, skilled workforce and its wide network footprint.