NAIROBI, Kenya, Nov 16 – Centum Investments is planning to divest in some of its investments as it spreads its portfolio to the health, education and ICT sectors.
The firms’ Chief Executive James Mworia says the investment firm is at an advanced stage of the divestitures without giving further details of the sector and nature of the exits.
“I am not in a position to mention the details now because of contractual restrictions, but it is important to give investors some guidance that there will be some exits in the pipeline,” Mworia told Capital FM Business.
He says divestitures are a natural cycle of Centum’s business.
“We routinely exit from companies…that’s the nature of our business. We have investments at various stages, from idea to exit. It’s a natural cycle of our business,” said Mworia.
Mworia said the company’s strategic focus of investing in eight sectors of the economy – real estate, power, financial services, FMCG, and now agriculture, healthcare, education and ICT, aims at changing how business is done in these sectors.
In its full year 2015/16 results, the firms’ improved performance was largely due to Sh5.4 billion gains realized from exits in its portfolio like AON and disposal of UAP to Old Mutual in the previous year. The firm had gross proceeds of Sh6.2bn from exits thereby boosting its liquidity position.
The firm posted Sh2.1 billion net profit in the six months that ended September 30, 2016 boosted by improved profitability in the Group’s portfolio companies.
Lower finance costs as a result of reduced forex losses on US dollar denominated borrowings and capitalisation of interest during construction of the Group’s real estate projects also attributed to the profit.
The company’s total assets grew by 10 per cent during the period, to close at Sh56.7 billion while growth in the book value of shareholders went up by 5 per cent to close at Sh40.7 billion, representing a 24 per cent outperformance of the NSE 20 Share Index.
The Net Asset Value per share increased from Sh13.8 in 2010 to Sh61.12 as at 30 September 2016, representing an increase of 343 per cent and a compounded annual growth rate of 22 per cent over the last seven years.
“The growth in the Net Asset Value per share is reflective of the company’s sustained focus on the preservation and growth of shareholder wealth through different market cycles”, said the Group Chief, Mworia noted.
On the investment portfolio front, the Company deployed Sh5 billion in debt and equity capital expenditure during the 6-month period within its portfolio companies.