New projects push Transcentury half-year profit to Sh589 million

By JAMES ANYANZWA

TransCentury Group registered a five per cent growth in pre-tax profit for the six months period ended June 30. The Company’s profit before tax (PBT) grew to Sh589.85 million from Sh564.13 million in a similar period last year.

In a statement yesterday the Company said its engineering business posted a 33 per cent growth in turnover driven mainly by new projects as well as significant growth in operations geared towards supporting new Mine builds across the region.

The power business however suffered a 14 per cent drop in turnover due to a marked reduction in World Metal prices.  The Group’s management remained bullish of an improved performance in power infrastructure and engineering businesses in the second part of the year.

“We are further encouraged by the progress made by Rift Valley Railways (RVR) where the sustained capital investments over the past 18 months have resulted in the business turning around and achieving break-even in the first half of this year (2013), “the Company said.

It said this is a commendable milestone for RVR and we expect that with continued investments RVR will for the first time achieve profit operations going forward and to contribute towards Group earnings.

TransCentury Group is betting on the huge oil and gas discoveries within the East African Community to drive its growth in income.

Chairman Zephaniah Mbugua said the upstream Oil and Gas activity continues to be a catalyst for economic growth in the region.

“The Upstream Oil and Gas activity continues to be a catalysts for economic growth in East Africa. In Kenya and Uganda the Oil companies moved closer to the beginning of the oil extraction phase which will result in large sums of capital investment in preparation of the extraction of the oil reserves,” Mbugua added.

Regional expansion

According to Mbugua new gas finds in Tanzania in 2012 is bound to fuel economic growth in Tanzania in the future. “East Africa’s development into an important oil and gas hub will create numerous opportunities across the economic spectrum, including the engineering and construction. Logistics and services sectors,” he said.

Through the 2012 annual report Mbugua points out that the growth outlook for the firm across its three key Divisions remain positive driven by strong fundamentals within the power, transport and logistics, and engineering and construction sectors.

The Kenya-based infrastructure company is listed on the Nairobi Securities Exchange with key focus on power infrastructure, transport infrastructure, and specialised engineering sectors, with additional operations in the consumer sector as well as affiliated holdings.

Last year, TransCentury continued to refocus its strategy on infrastructure and engineering by divesting from its Consumer Business  ‘Chai Bora’ Tanzania’s leading packaged tea manufacturer.

Proceeds of the sale were redeployed into TransCentury’s core divisions — power, transport and engineering.  TransCentury continued with its strong growth momentum arising from organic growth in Power and Engineering Divisions as well as a positive impact of the consolidation of the Group’s recent strategic acquisitions.