Kingdom Securities announces Sh19.6 m loss

By James Anyanzwa

The newly formed Kingdom Securities stock brokerage firm has announced a Sh19.6 million loss for the full financial year period ended December 31.

The company attributed the dismal performance to squeezed revenues, owing to huge establishment costs, which accrued after its inception in June last year.

According to the company’s financial statements released on Thursday, total revenues jumped 95 per cent to Sh25.37 million, from the previous year’s Sh12.95 million.

Watered down

But the gains were watered down by a colossal 122 per cent growth in expenditures to Sh45.04 million, from Sh20.31 million.

Mr Geoffrey Odundo, the company’s managing director, explained that the enormous cost outlays were incurred on exceptional establishment costs for operations, and improving the quality of the company’s books.

"As you may be aware, the company has been in operation for only six months, having been established in 2009," he said.

Odundo was speaking during the official launch of the company’s new banking premises in Nairobi yesterday.

He was optimistic the company would turn around this year, and register positive results for the shareholders.

"This year will be the company’s first year in operation, and we expect a better performance," said Odundo.

"The market is recovering, and we believe this healing is going to be sustainable," he added.

He said the company has begun to break even on a monthly basis.

Kingdom Securities was born after its parent company, Co-operative Bank Group, acquired a 60 per cent majority stake in Bob Mathews Stock Brokers Ltd in June last year.

The strategic acquisition was crafted to ferry stockbrokerage services to the common mwananchi, through the bank’s expanded savings and credit societies (Saccos).

Largest retail agency

Mr Odundo said the broker has already established the largest retail agency network of over 250 outlets, consisting of 124 co-operative societies, 79 Co-op Bank branches, and 50 independent agents.

"Through these agency outlets, our services will be accessible all over the country, given its geographical spread," said Odundo.

The agency outlets are also expected to help wananchi save costs of accessing stock brokerage services.

The Kingdom Securities’ stockbrokerage business is supported by Co-operative Bank’s strong financial base.

The bank’s pre-tax profits last year grew by 11.2 per cent to Sh3.74 billion and currently controls a total of Sh16.2 billion in share capital.