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Kenya

Uchumi’s fortunes continue to grow

NAIROBI, Kenya, Sep 9 – Retail chain Uchumi has reported an 18.8pc rise in profit before tax to Sh514.8m for the full year to June 2011 driven by a growth in sales revenue and good cost management.

Uchumi’s Chairman Eng Abdulrazaq Ali further added that focus and redefined business objectives has seen them increase annual customer numbers by 10 percent to 19 million compared to the 18 million registered in the previous year.

“Performance has continued to improve for the fifth year running. Sales revenues and gross profits grew by 12.8 percent or Sh1.2 billion and 10 percent or Sh214 million respectively,” said the chairman in a statement which showed that total net sales rose by 12.8 percent to Sh10.8billion.

Although inflation continued to soar during the period under review, the board and management was able to contain it and ensure that the ratio to net revenue remained flat at 16.8 percent.

The impressive performance was also reflected in the balance sheet which shot up to over Sh4 billion up from Sh3.15 billion posted in the 2009/2010 financial year.

However, the earnings per share declined from Sh4.81 in the previous year to Sh1.47 as the number of shares in circulation increased by 85 million to 265 million.

This was due to the re-capitalisation exercise that was undertaken during the balance sheet’s restructuring after the chain was lifted out of receivership.

Eng Ali said that the chain’s future outlook remained positive as the business positions itself strategically in various new locations in the East African region.

Uchumi’s shares were re-admitted to the Nairobi Stock Exchange in May this year after a five year suspension although the current bear run has been clouding its performance causing the share price to shed about 45.5 percent of its value since its debut.

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The good results seem to have been received well by the market as they saw the share rise 5. 7 percent to close the day at Sh8.35.

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