Investment firm TransCentury saw its negative equity widen to Sh3.3 billion in the year ended December on the back of continued losses.
The company has not announced new capital-raising plans even as its external auditors KPMG Kenya emphasised the company’s difficulty in meeting its short-term obligations.
The Nairobi Securities Exchange-listed company first wiped out its capital in the year ended December 2017 when it booked a negative net worth of Sh112 million.
In the review period, TransCentury made a loss of Sh3.5 billion, narrowing it down from a loss of Sh4.3 billion a year earlier. The company’s expenses, including finance and operating costs, continue to surpass its revenues.
TransCentury says it will benefit from a recent debt restructuring exercise whose details it has not communicated to the market.
“While the 2018 financial results do not fully reflect the significant progress made in key areas highlighted above, the scorecard is already positive, and the benefits will start to come through in 2019,” TransCentury said in a statement.
The larger negative equity, however, means that shareholders would not get a cent if the company was to be liquidated today to pay off creditors.
TransCentury’s share, however, is trading at a premium of Sh3.6 per share on the NSE, assigning the company a market value of Sh1.3 billion.
Private equity firm Kuramo Capital, which acquired a 25 percent stake in TransCentury in 2016 for Sh2 billion as a turnaround investment, is among those counting major paper losses from the company’s weaker performance.
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