Sameer Africa has posted the highest profit in 11 years, boosted by the appreciation of the shilling against the dollar and a decision to dial down on borrowing in the financial year ending December 2024.
The firm’s results published on Friday showed that net profit surged 5.6 times to Sh259.89 million from Sh46.34 million posted in the previous year.
The latest net profit is the highest since the Sh401.19 million in 2013, which was also the last time it paid a dividend of Sh0.13 per share.
However, the board has not declared a dividend on the latest performance as accounts showed a drop in revenue and working capital—the difference between current assets and current liabilities—worsening to negative Sh428.4 million from the prior year’s negative of Sh8.65 million.
Sameer says the latest performance was largely due to the strengthening of the Kenyan shilling against the dollar, which resulted in lower import costs and reduced spending on servicing of loans.
“The group recorded a significant improvement in profit after tax compared to the prior year, mainly due to the impact of the appreciation of Kenya shilling against the United States dollar on dollar-denominated liabilities,” said Sameer in a commentary accompanying the financial results.
The local currency appreciated by about a fifth against the dollar last year compared to the prior year when it had lost about a quarter of its value against the greenback.
As a result of the appreciation during the period, Sameer says it booked an unrealised net foreign exchange gain of Sh83.6 million, boosting to its bottom line despite a decline in operating profit.
During the year, Sameer says it fully repaid its borrowings, resulting in lower interest expenses. The prior year’s borrowings were Sh540.69 million from related parties, comprising Sh440.69 million from Sameer Investments and Sh100 million from Sameer Telkom.
Sameer’s revenue fell to Sh389.48 million from Sh390.49 million, while operating expenses shot to Sh176.57 million from Sh148.92 million.
The latest profit has helped Sameer cut its accumulated losses to Sh481 million from Sh740.9 million.
