TransCentury Limited has sunk deeper into negative territory dampening efforts by the listed investment firm to reverse fortunes and return to profitability.
The firm on Saturday issued a public notice warning investors that earnings for the past year will fall sharply compared to the previous year.
“The board of directors of TransCentury Limited wishes to inform the shareholders, potential investors and general public that based on preliminary assessment of the audited accounts, the earnings for the financial year ended December 31, 2017 may be more than 25 per cent lower compared to the net earnings for the year ended December 31, 2016,” read a statement from the firm.
This has dealt a major blow to the company that has been struggling to reverse a string of poor financial results recorded over the past few years.
During 2016 financial year, the investment group that started as a chama in 1995, chalked Sh864 million in losses as revenues hit Sh8.1 billion against Sh7.1 billion in cost of sales. This was an improvement from Sh2.4 billion loss in the previous year.
Trouble for TransCentury stemmed from the firm’s inability to raise funds to repay a Sh8 billion Eurobond facility floated in 2011 that matured in 2016.
The firm was forced to sell part of its stake to New York-based investment firm Kuramo Capital Management LLC leading to a boardroom shakeup that saw the ouster of its founding directors.
TransCentury has blamed the depressed earnings to last year’s general elections and the cap on interest rates introduced in 2016.
“The decrease in net earnings is attributed to declined performance in the opening units due to delayed spending on infrastructure projects that affected our customers as a result of uncertainties brought about by the prolonged electioneering period during the year,” said the company in a statement.
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