KenolKobil records 299pc jump in pre-tax profit on effective inventory management

Kenya: Oil marketer KenolKobil more than tripled its earnings for the six-month period to June 30 with the management attributing the improved performance to effective inventory management and increased focus on better margin business lines.

The company's pre-tax profit jumped 299 per cent to Sh795.18 million from Sh199.08 million in a similar period last year.

Managing director David Ohana said the management has made strategic interventions in the company's subsidiaries to achieve expected target growth levels.

In a media advert yesterday, Mr Ohana said the management would maintain its focus on key growth drivers, which include corporate restructuring, prudent control of financing and operating costs, risk reduction and the realignment of the human resources.

"During the period under review, the global economic environment remained challenging. However, with focus on better margin business lines and effective inventory management, strong gross margins were achieved," he said.

According to the Group's unaudited financial statements released yesterday, the company's net sales plunged 34 per cent to Sh43.18 billion from Sh65.27 billion in a similar period last year.

Finance costs went down 16 per cent to Sh669.33 million from Sh801.49 million while forex losses reduced 10 per cent to Sh142.26 million from Sh158.54 million in a similar period. Similarly, borrowings fell 10 per cent to Sh13.3 billion from Sh14.85 billion.

Kenolkobil returned to the profit-making territory last year, posting a net profit of Sh558 million driven mainly by sale of its assets, which generated Sh1.4 billion.

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