Flame Tree Group Holdings, a listed leading African manufacturer and distributor of plastics, packaging material, fast moving consumer products and household items, lowered its net loss to KSh 15.9 million in 2025 from net loss of KSh 91.7 million the year prior.
Breaking Down the Numbers
After issuing a profit warning, the Flame Tree Group reported EBITDA growth of 18% year-on-year (excluding one-off insurance income in FY2024), reaching KSh 384.5 million, supported by strong performance across its core business segments and improved operational efficiency.
Gross margins increased significantly from 35% to 38%, reflecting disciplined pricing, better product mix, and cost optimization initiatives.
Flame Tree Group also strengthened its balance sheet substantially, with Net Assets increasing by 25%, driven by continued investment in production capacity, particularly within the packaging division, positioning the Group for long-term growth.
Sales grew by 2%, led by strong performance in the Water, Sanitation & Packaging division (8%) and FMCG (5.1%).
“Our 2025 financial results demonstrate the resilience and strength of our underlying business,” said Heril Bangera, CEO of Flame Tree Group Holdings.
“We achieved strong EBITDA growth, improved margins, reduced losses, and expanded our asset base significantly. Our investments in packaging capacity are already enhancing operational efficiency and will support future growth opportunities across the region,” said Bangera.
Key Highlights
- EBITDA increased 18% to KES 384.5 million*
- Gross margin improved from 35% to 38%
- Net Assets increased by 25%
- Strong growth in Water, Sanitation & Packaging (8%) and FMCG (5.1%)
- Interest costs reduced by 23%
- Working capital efficiency improved to 41 days
Flame Tree Outlook for 2026
Flame Tree Management remains cautiously optimistic for 2026 despite increasing global uncertainty and volatility in commodity markets following recent geopolitical developments.
Flame Tree Group also said it continues to focus on strengthening working capital, securing raw material supply, maintaining cost efficiency and supporting sustainable long-term growth
Dividend
The Board does not recommend the payment of a dividend for the 2025 financial year.
About Flame Tree Group Holdings
Flame Tree Group Holdings is a diversified African manufacturing group operating across Kenya, Rwanda, Ethiopia, Mozambique, Mauritius, and UAE, with leading brands in plastics, packaging, cosmetics, food products, and household goods.
According to analysts, Flame Tree’s 2025 financials paint the picture of a business that is steadily recovering operationally but still constrained by balance sheet pressure.
Its revenue growth drivers were supported by water, sanitation & and packaging, and FMCG segments, reflecting continued demand for essential household products despite a subdued consumer environment. Overall, growth remains muted, highlighting ongoing pressure on discretionary spending.
The cost of sales declined by 2.9% even as revenue increased. This improvement in cost control lifted gross profit by 9.8% and expanded gross margin to 37.8%. In simple terms, the company is now earning more per unit sold than last year.
Operating Performance
EBITDA rose strongly by 18% to KSh 384.5Mn, indicating improved core operational efficiency. The sharp decline in reported operating profit of 50.4% is largely due to a one-off insurance-related gain in 2024, which inflated prior-year results and distorts year-on-year comparison.
Finance costs remained high at KSh 306.99Mn. Although slightly lower, the debt burden continues to weigh heavily on earnings. However, this is a significant improvement from prior periods and suggests movement closer to breakeven.
Net cash from operations turned positive at KSh 157.16Mn, a key positive signal. This indicates that the business is once again generating cash from core operations rather than consuming it.
However, trade receivables rose 15.1% to KSh 1.37Bn, which may indicate slower customer payments or increased credit exposure.
No dividend was declared, which is consistent with the company’s priority to preserve cash and strengthen its balance sheet.
“Flame Tree Results show clear operational recovery at the gross profit, EBITDA, and cash flow level. However, high leverage and finance costs continue to suppress bottom-line performance,” said Dedan Maina, a CFA a Ketu Capital.
Investors will be watching how this firm steps on the gas pedal to grow its revenues, sustain margin improvement and reduce its debt load.
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