Flame Tree’s profit up 17pc on higher sales

Flame Tree Group has recorded a 17 per cent increase in full year profit after tax to Sh179 million, riding on increased sales.

Annual net sales increased 29 per cent to Sh2.28 billion, compared to sales of Sh1.76 billion recorded in a similar period in 2014.

The firm operates manufacturing and trading businesses. It trades in plastics, cosmetics and food. This is Flame Tree’s first full year profit announcement after listing on the Nairobi Securities Exchange (NSE) in October 2014.

“In the face of increasing competition and a tough economic environment, we have made considerable progress on our strategic plans, to generate an 86 per cent increase in our normalised operating profits,” said Flame Tree Group CEO Heril Bangera in a statement, “The acquisitions made in foods, snacks and cosmetics capped off financial year 2015 really well for us.”

Flame Tree said capital investments made in 2015 expanded its manufacturing capability and product line, leading to increased sales.

Its manufacturing arm contributed 75 per cent of the total revenue. Flame Tree acquired Chirag Kenya, a snacks and spices maker, during the year in a bid to grow revenue and expand its presence in the food industry.

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The brands were generally strong performers in the premium natural spice category, one of the leading brands in the spices category in Kenya.

It also acquired three haircare brands from Beauty Plus Trading East Africa — Miss Africa, Black Angel and Beautyplus.

The new brands doubled the size of the food portfolio and increased revenue, said Mr Bangera.

“We’re really pleased with how the integration of the new brands has gone and are excited about the domestic food production category across the region,” said Mr Bangera.

In January, Flame Tree signed a deal to acquire colour cosmetics brand SuzieBeauty at an undisclosed cost.

“We see more potential for innovation in our portfolio,” said Mr Bangera.