Connect with us

Hi, what are you looking for?

Gross profit jumped 74 percent to Sh975 million last year/file


HF’s profits surge in 2011

Gross profit jumped 74 percent to Sh975 million last year/file

NAIROBI, Kenya, Feb 22 – Housing Finance (HF) posted a 64 percent rise in profit after tax, recording Sh622.2 million last year up, from Sh379.5 million posted in 2010.

Gross profit jumped 74 percent to Sh975 million last year, up from Sh561 million in 2010, despite the economic downturn.

Managing Director Frank Ireri attributed the improved performance to practical cost management and brand positioning, which he said helped cushion the firm from high inflation and harsh economic times.

The MD expressed confidence in the firm’s continued strong performance in 2012 with the securing of long term stable funds.

“We are optimistic that we can maintain the growth curve in the current financial year on the back of long-term financing which will shield the company from current market fluctuations in the money market,” he said.

The financier experienced a Compound Annual Growth Rate (CAGR) of 33 percent in its performing mortgage loans between 2010 (Sh18.4 million) and 2011 (Sh24.1 million).

The CAGR for its Net Non-Performing Loans (NPL) posted an 11 percent drop for the same period, with its NPL book was at an all time low of 3.8 percent.

The move to adjust its lending rate by only two percent to 16.5 percent for its existing customers, Ireri said, has helped keep a clean mortgage book.

HF also plans to roll out current accounts to its customers in the first quarter of this year, which will result in the reduction of funding costs and increase of deposits available for mortgage lending.

Ireri said the financier’s five-year strategy which ended last year was a major boost to the firm, adding that earnings per share had increased by 26 percent over the same period.

Advertisement. Scroll to continue reading.

The final dividend was set at Sh0.70 in addition to the interim dividend of Sh0.50 resulting in a dividend yield for 2011 of 9.7 percent which reflected a 100 percent growth from the 2010 dividend per share of Sh0.35.

Over the next five years HF’s strategy (2012-2016) will see the implementation of new technologies, Banc Assurance and national and regional expansion.

HF believes that the national elections, inflation, Eurozone crisis and the war in Somalia are key factors expected to shape performance in 2012.


More on Capital Business