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BOC Kenya executives’ Sh45m pay exceeds 2017 net profit

Millicent Onyonyi
From left: UN Women programme analyst Arjmand banu Khan, former BOC Kenya managing director Millicent Onyonyi and Capital Markets Authority CEO Paul Muthaura during a past event. FILE PHOTO | NMG 

BOC Kenya #ticker:BOC executives were paid a total of Sh45.2 million in the year ended December, an amount larger than the Sh39.3 million net profit made by the gas manufacturer in the review period.

The Nairobi Securities Exchange-listed firm has been on a long-term decline, with its sales and net earnings tumbling from highs of Sh1.2 billion and Sh229.6 million respectively in 2014.

BOC chief executive Millicent Onyonyi, who resigned on April 30, earned a total of Sh28.9 million in the review period, a 46.7 per cent rise from Sh19.7 million the year before according to disclosures in the company’s latest annual report.

Her compensation in the review period comprised a salary of Sh14.6 million or Sh1.2 million per month and house allowances of Sh10.5 million. She was paid a salary of Sh10.6 million or Sh884,000 per month and house allowances of Sh7.8 million in the previous year.

BOC’s finance director earned a total of Sh16.2 million in the review period, up from Sh15.4 million a year earlier. The company’s net profit dropped 68.8 per cent to Sh39.3 million in the year ended December compared to Sh126.3 million a year earlier on the back of higher costs and 10.1 per cent sales decline to Sh967.6 million.

The company has maintained a dividend payout of Sh5.2 per share or a total of Sh101.5 million in each of the past five years despite the reduced earnings, a move that has seen it dip into reserves to partially fund the distributions.

BOC specialises in manufacture and sale of industrial and medical gases and welding products. The company has attributed its challenges to customer debt, a lack of regulation of the industry and increased competition that has forced it to cut prices.

“Key external business challenges remain competition from low-cost competitors in a sector with minimal regulatory oversight, illegal filling of the company’s cylinders by other parties, lack of enforcement of standards for medical oxygen, competition from imported liquid oxygen and slow and delayed settlement of trade debt by many public sector customers,” BOC chairman Ngugi Kiuna said in the report.

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