- Real People is still stuck in a negative equity position, with total assets standing at Sh1.13 billion against Sh1.29 billion in liabilities at the end of October.
South African-linked credit-only micro-financier, Real People Kenya Ltd, cut net losses for six months through September by 58.11 per cent on reduced impairments and operating costs.
Losses dropped Sh97.50 million in September compared to Sh232.76 million a year earlier, the troubled firm said in a financial statement.
The micro lender’s impairments dipped 67.89 per cent to Sh53.46 million while operating expenses dropped 17.50 per cent to Sh176.46 million in the review period.
Real People has failed to honour debt service obligations for a bond it issued three years ago.
The medium-term note launched in early August 2015 targeting retail, high-net-worth individuals and institutional investors saw investors take up Sh1.363 billion in five-year fixed rate notes and Sh270.3 million in three-year fixed rate notes.
“The capital remains below the minimum covenant requirements and the company, therefore, remains engaged with debt and equity providers with a view to alleviating the debt and interest burden borne by the company and to placing the company on a path to sustainable profitability,” the company said.
Real People is still stuck in a negative equity position, with total assets standing at Sh1.13 billion against Sh1.29 billion in liabilities at the end of October.
“The auditor disclaimed an opinion in respect of the 2018 financial year, based on the going concern assumption,” the firm said.
“This aspect continues to receive attention at a high level, but has not yet been resolved.”
South African Global Credit Ratings warned last December there was a strong possibility that the group would breach its capital adequacy ratio in the near term, or fail to meet debt obligations.
Launched in Kenya in 2006, Real People has struggled to have a stable board. Its managing director Neil Grobbelaar resigned on January 8, 2018, just six days after director Arumugam Padachie resigned.
Mr Albert Ruturi (director) and Ms Nthenya Mule (non-executive) also left in July last year.