Centum Investment Company has reported a 68.8 percent drop in net profit for the year ended March 2025, owing to lower fair value gains on its investment property and higher deferred tax charge.
The listed investment firm reported a net profit of Sh812 million in the year ended March, a drop from Sh2.6 billion posted over the same period a year ago.
Its fair value gains declined 54.8 percent to Sh3.2 billion from Sh7 billion, which was attributed to low inflation and a more stable shilling during the year.
“Consolidated profit after tax declined to Sh812 million from Sh2.6 billion, largely due to lower fair value gains on Centum Real Estate and Special Economic Zone investment properties, following an exceptional prior year transaction,” said Centum.
It booked gains on investment property of Sh1.9 billion from its real estate projects compared to Sh3.6 billion last year, while those from its special economic zone were Sh1.2 billion down from Sh3.3 billion in 2024.
“The fair value gains have been muted because of low inflation and stable shilling - so asset valuation could only adjust marginally,” said Ronny Chokaa, senior analyst at Capital A Investment Bank.
Centum Investment tax charge was Sh1.3 billion being 61.9 percent of its profit before tax, up from Sh304 million paid to the tax man last year which was 10 percent of the pre-tax profit.
The company attributed the increase to asset reclassifications and a change in the tax rate for land not held for sale from five percent to 15 percent.
Centum’s trading business reported lower losses of Sh489 million, from a loss position of Sh705 million in 2024, riding on lower operating costs.
Trading business category in Centum’s financials captures the performance of its unquoted investments such as Isuzu East Africa, NAS Airport Services and Africa Crest Education Holdings.
Financial services segment of the company reported a profit of Sh90 million on lower financing costs following debt repayments of Sh1.2 billion.
Centum’s signature asset, Two Rivers Development, remained in the red by reporting a lower loss of Sh242 million from Sh965 million in the year ended March 2024. The lower losses were due to reduction in financing costs to Sh251 million from the previous year Sh888 million.
Its special economic zone reported a huge profit slump to Sh88 million from Sh2.9 billion arising from the drop in fair value gains and a tripling of its funding costs.
Despite the profit drop that forced the company to issue a profit warning late last month, the investment firm retained its dividend pay at Sh0.32 per share.
“In line with our disciplined capital management, the board has proposed a final dividend of Sh0.32 per share maintaining the payout level from the prior year. This amounts to Sh210 million, subject to shareholder approval,” said Centum.
The company said it had bought back a total of 150,800 shares by the end of June 2025 under the share buyback program initiated eight months ago, in October 2024.
The number of shares bought back is 0.23 percent of what the company is targeting in the program whose attractiveness to investors has been watered down by Centum’s trading share price at the Nairobi Securities Exchange rallying past the offer price of Sh9.03 per share.
The company share price has rallied 11 percent in the last six months closing at Sh12.05 per share in Monday’s trading.
