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Cost cutting pumps up Total profit to Ksh4 billion

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Prudent cost-management is paying off for oil marketer.

Total Kenya has announced a 50.3%  growth in pre-tax profit to Ksh3.94 billion for the full-year 2016. The rise was 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 firm, listed on the Nairobi Securities Exchange, said its total assets increased from Ksh34.22 billion in 2015 to Ksh36.18 billion last year. Profit after tax increased by 38% from Ksh1.62 billion in 2015 to Ksh2.23 billion.

The drop in international oil prices led to a decrease of 26% 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 Kshs 6.99 billion in 2015 to Kshs 7.85 billion last year.

Due to the stability of the Kenya shilling against the US dollar, the forex loss was lower at Ksh22 million compared to Ksh320 million in 2015. Investments in long-term assets totalling to Ksh1.54 billion were made in the year, in line with the strategy to develop the business in the core activities and to continue to tap business opportunities.

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 Ksh1.06 per share for the year compared to Ksh0.77 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.


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BT Correspondent
BT Correspondenthttp://www.businesstoday.co.ke
editor [at] businesstoday.co.ke
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