NSE companies pay parent firms Sh40bn dividends

Standard Chartered Bank of Kenya last year spent Sh205.63 million on redundancies.

Photo credit: File | Nation Media Group

Multinationals with subsidiaries operating and listed in Kenya are set to earn a total of Sh40.1 billion in dividends, comprising final and interim payouts by firms such as Safaricom, Absa Bank Kenya and BAT Kenya.

The multinationals earned a slightly higher sum of Sh40.7 billion worth of dividends in the comparative period a year earlier.

The new payouts mark a decline in cash returns for the parent companies like Vodafone Group Plc, Vodacom Group Limited and BAT Plc.

The analysis captures payouts by nine Nairobi Securities Exchange-listed companies including Bamburi Cement, East African Breweries Plc (EABL), Kakuzi, Stanbic Holdings, Standard Chartered Bank Kenya and Total Kenya.

Most of the companies maintained or raised their dividends with the exception of Safaricom and Bamburi which also posted reduced earnings due to higher investments and costs respectively.

Vodacom and Vodafone, the multinationals that own a combined 40 per cent stake in Safaricom will receive the largest combined payout of Sh19.2 billion for the telco’s year ended March.

This will however be a drop from the Sh22.2 billion they earned the year before.

Safaricom cut its total dividend per share to Sh1.2 per share from Sh1.39 amid a fall in profit occasioned by startup losses in Ethiopia where it is investing heavily for future growth.

The telco’s net income declined 22.2 percent to Sh52.4 billion in the year ended March compared to Sh67.4 billion a year earlier.

British banking multinational StanChart earned Sh6.1 billion from its Kenyan subsidiary in which it owns ordinary shares amounting to a 73.8 percent stake.

The earnings were a rise from Sh5.3 billion it received in the prior year after the NSE-listed lender raised its dividend per share from Sh19 to Sh22.

The bank grew its net profit to Sh12 billion in the year ended December compared to Sh9 billion the year before, helped by higher interest and non-interest income.

South Africa’s Absa Group followed with the third highest dividend income of Sh5 billion from its Kenyan banking subsidiary, representing a significant increase from the previous Sh4 billion.

This was after Absa Bank Kenya raised its total dividend per share to Sh1.35 from Sh1.1.

Swiss-French multinational Holcim Group, which owns a 58.6 per cent stake in Bamburi Cement, is set to receive a smaller payout of Sh159.5 million from the Kenyan firm.

It earned a dividend of Sh761.5 million the year before, with the reduced income as a result of Bamburi cutting its payout per share to Sh0.75 from Sh3.58.

Bamburi Cement's net profit for the year ended December 2022 dropped by 86.9 per cent to Sh181 million on the back of reduced sales and increased costs.

British multinational Diageo which owned a 50.03 per cent of EABL before its recent additional share purchases, earned an interim dividend of Sh1.4 billion.

PAYE Tax Calculator

Note: The results are not exact but very close to the actual.