Out of the 11 firms in which the government has a stake, only five survived the difficult environment, made profits and declared dividends.
The government earned Sh22.33 billion from the same shares ownership in 2016, helped by a special dividend from telecoms operator, Safaricom, where it has a 35 per cent stake.
Ownership of ordinary shares in public listed companies earn the government the billions of shillings in dividends, adding to the fees and the 30 per cent corporate tax that resident companies pay.
The National Treasury’s share of dividends from its ownership of Nairobi Securities Exchange (NSE)-listed companies dipped 21.5 per cent to Sh17.54 billion in 2017, reflecting the poor performance of most of the firms during the period.
Out of the 11 firms in which the government has a stake, only five survived the difficult environment, made profits and declared dividends.
The government earned Sh22.33 billion from the same shares ownership in 2016, helped by a special dividend from telecoms operator, Safaricom #ticker:SCOM, where it has a 35 per cent stake.
Ownership of ordinary shares in public listed companies earn the government the billions of shillings in dividends, adding to the fees and the 30 per cent corporate tax that resident companies pay.
Safaricom, for instance, paid the government Sh15.42 billion out of the Sh55.1 billion profit it made for the financial year that closed in March 2017 having declared a dividend of Sh1.10 per share.
This was, however, lower than the previous year’s Sh20.2 billion payout that included ordinary dividend of Sh10.68 billion and a special dividend of Sh9.52 billion.
Kenya Commercial Bank #ticker:KCB, where the Treasury has a 17.53 per cent stake, paid the Exchequer Sh1.61 billion dividend, same as in 2016. But unlike 2016 when the bank paid out the Sh3 per share dividend at once, last year’s payout was split between interim and final dividends.
Stanbic Bank #ticker:SCBK, another lender in which the Treasury has a stake, paid Sh22.8 million dividend, same as in 2016, despite a 1.9 per cent drop in profit. The government has a 1.1 per cent stake in the bank.
Mortgage lender Housing Finance #ticker:HFCK paid in Sh2.95 million dividend after fixing the payout per share at Sh0.35 from the previous year’s Sh0.50. The Treasury has a 2.41 per cent stake in the lender, whose profitability shrunk 86 per cent.
Power distributor Kenya Power #ticker:KPLC paid the Exchequer a Sh488.8 million dividend for the Treasury’s 50.09 per cent stake in the firm having retained the payout at Sh0.50 per share.
Kenya Electricity Generating Company (KenGen) #ticker:KEGN did not pay dividends and instead advised shareholders to hold onto the share price appreciation.
Five loss making companies in which the government has a stake, including Mumias Sugar #ticker:MSC, Kenya Airways #ticker:KQ, Uchumi Supermarket #ticker:UCHM, East African Portland Cement #ticker:PORT and National Bank of Kenya (NBK) #ticker:NBK did not pay any dividends.
Mumias Sugar where the government has a 20 per cent stake is in Sh20 billion debt despite numerous state bailout efforts. The government’s 14.67 per cent stake in Uchumi Supermarket has also seen it pump in money despite persisting losses.
The Treasury has committed to pump money into capital-constrained NBK this year even as it awaits to see if the complex debt restructuring at KQ – the troubled airline where it has recently guaranteed billions of shillings in loans will yield fruits.
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Note: The results are not exact but very close to the actual.
