Express Kenya narrows full-year loss to Sh69.6m on cost cuttingMonday April 29 2019
Logistics firm Express Kenya reduced its net loss by 22.8 percent to Sh69.6 million in the year ended December 2018, helped by lower costs.
The company, whose bid to transform into a real estate developer ran into financing difficulties, had made a net loss of Sh90.3 million the year before.
The smaller loss came amid significant reductions in costs including administrative expenses which fell to Sh28.8 million from Sh56.9 million.
Continued losses, however, saw the company’s negative net worth widen to Sh136.8 million from Sh67 million.
The loss-making clearing, forwarding and warehousing businesses, coupled with the slow pace of transforming into real estate development, has seen the company’s financial performance deteriorate over the years.
Express Kenya’s chief executive and majority shareholder Hector Diniz, who has propped up the company with loans, last year failed in his bid to buy out the minority shareholders and de-list the firm from the Nairobi Securities Exchange (NSE).
Mr Diniz, who already owned a 61.64 percent stake in the company, made an offer of Sh5.5 per share which was accepted by shareholders with 9.78 percent equity, bringing their total stake to 71.42 percent.
This fell short of the 75 percent minimum target. Express Kenya’s share price last traded on the NSE at Sh6.
A section of the company’s significant shareholders rejected Mr Diniz’s offer after it emerged that the company was worth much more based on the value of its 15.7 acres of land in Nairobi’s Industrial Area.
The CEO had an option of raising his bid or extending the offer period but decided to let the proposed buyout lapse.