Companies

KenolKobil loses market lead to Total

EA-Total

KenolKobil has lost its position as the country’s largest oil marketer to rival Total Kenya after ending its fuel price discounts. Photo/FILE

KenolKobil has lost its position as the country’s largest oil marketer to rival Total Kenya after ending its fuel price discounts.

Data from the Petroleum Institute of East Africa, the industry lobby, shows that Kenol’s market share dropped to 21.4 per cent in the nine months to September compared to 25 per cent in the year ended December 2011.

This  gave Total a slight lead with a market share of 21.5 per cent in September compared to 23.3 per cent in December last year, when it first lost market leadership to Kenol.

(Read: Kenol widens market lead over Total volumes)

Kenol’s market share was munched by Total and several smaller oil marketers after Kenol ended its popular fuel price discount promotion on August 27. The company has credited its previous market share gains to the promotion.

“The popular ‘Deal Poa’ promotion offering Kenyan motorists fuel savings of Sh3 per litre off the official pump price has come to an end,” Mr David Ohana, Kenol’s general manager, said in a statement.

Mr Ohana added that customers on Kenol’s loyalty card will continue to enjoy daily discounts of Sh2 per litre.

The promotion, which has seen Kenol’s customers save more than Sh300 million, has been running on Sundays since March last year and it has significantly raised the company’s sales volume.

However, the company reverted to the prices set by the Energy Regulatory Commission, a move that has opened the doors for rivals, including Total, Bakri, Gulf and Hashi Energy to eat into Kenol’s market share.

Total, for instance, increased its sales 14 per cent to 779,000 tonnes in the nine months to September compared to 685,000 tonnes a year earlier.

Total said it has won several contracts to supply the oil industry with refined products under the Open Tender System in what it expects to sustain its market leadership.

“As a result, the company expects to continue to enjoy significant market share through more secured supply, lower working capital requirements and, therefore, lower financial expenses,” Total’s Managing Director Alexis Vovk said in a statement.

Despite the gains, Total posted a net loss of Sh243.6 million in the nine months to September as sales increased 15.2 per cent to 86.7 billion. Its share price has lost 14.4 per cent in the past six months to Sh13.7 in contrast to Kenol’s that has gained 18.8 per cent to Sh14.8 over the same period.

(Read: Total Kenya gets debt relief from parent company)

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