This archive report was first published on 4 July 2021.
On March 31st, 2021, Centum Real Estate Limited reported a substantial decline in its financial performance, with earnings plummeting to KSh 650.4 million from KSh 2.3 billion in the previous year.
The company's investment income also took a hit, decreasing to KSh 1.4 billion from KSh 3.9 billion at the end of March 2020.
According to the firm's consolidated statement of comprehensive income, operating profit fell to KSh 3.4 billion from KSh 1.2 billion in 2020.
However, the firm's Balance Sheet size grew from KSh 34.1 billion in 2020 to KSh 39.6 billion in 2021, while pre-tax profit dropped from KSh 2.9 billion to KSh 272.8 million at the end of March 31st, 2021.
Centum Real Estate is the holding entity of four subsidiaries, including Vipingo Development Limited, Centum Development Kenya Limited, Uhuru Heights Limited, and Pearly Marina Estates Limited in Uganda.
Following a reorganization in September 2020, Centum Investment consolidated its entire real estate holdings under one holding company, Centum Real Estate Limited, with the exception of its 58% interest in Two Rivers Development Limited.
Centum Managing Director Samwel Kariuki attributed the decline in earnings to an initial slowdown in residential unit sales in the first quarter and operational disruptions, particularly in Uganda.
Despite the challenges, Kariuki noted that cash collected as customer deposits increased by 20% from KSh 1.5 billion to KSh 1.8 billion.
In December 2020, the firm raised KSh 3 billion through a zero-coupon bond at a yield of 12.5%, which matures in December 2023. The bond proceeds were applied to two projects in Nairobi: Riverbank apartments and Loft Duplexes.
The Riverbank apartments are nearing completion, while the Loft Duplexes will be complete in the next financial year. Both projects have a sale value of KSh 3.4 billion, with units worth KSh 1.9 billion, representing 56% of total sellable units, having been sold.
Centum has approved a pipeline of 4,520 homes for development in Kenya and Uganda, with 96 already completed and a further 1,952 either under construction or market valuation.
The firm expects a total of KSh 17.9 billion in revenue potential from this pipeline to reflect on its financial statements beginning March 31st, 2022.
