The Treasury has been allocated a Sh106.5 million (£0.8 million) net profit for its 40 percent stake in Nairobi-based currency printer De La Rue Kenya EPZ Limited in the year ended March.
The government acquired the shares from British multinational De La Rue Plc in April last year, creating the local joint venture.
The multinational says in its latest annual report that the Kenyan unit made a net profit of Sh292.7 million ((£2.2 million) in the review period.
The subsidiary, however, did not pay dividends to the National Treasury or its parent company. Its sales in the review period stood at Sh438 million (£3.3 million).
The National Treasury acquired the 40 percent minority stake at a cost of Sh665.7 million (£5 million).
The deal gives the government, the largest customer of De La Rue, an opportunity to recoup part of its currency printing expenses through profit-sharing.
The conglomerate is also betting on the joint venture to smoothen its relations with the government, which had been rocky for years.
“Management believes the transaction provides an opportunity to create greater long-term value for shareholders and this joint venture fits with our strategy of expanding into key growth markets through long-term partnerships and local investment,” said the multinational.
Besides local customers including the Kenyan government, the De La Rue factory also prints currency and documents for export to overseas clients.
Kenya is likely to continue relying heavily on hard cash for payments.
Cash accounts for 98 percent of total payment transactions in the country, according to a report by McKinsey and Mastercard Advisers.
However, increased uptake of digital payments enabled by cards, internet and mobile telecommunications could reduce its dominance in the long-term.
The British multinational continues to operate and manage the joint venture given that it appoints three of the five directors who serve on the company’s board.
The Nairobi-based currency printer was in 2018 awarded a Sh10.86 billion (£85 million) three-year contract to design and manufacture Kenya’s new generation currency. The notes were rolled out from June last year.