Centum Investment Company breaks 8-year dividend drought

Centum Investment Company has declared dividends for the first time in eight years, ending a freeze that had started to make investors uneasy.

The investment company said it will pay Sh1 for every share after it reported a 25 per cent growth in profits after tax to Sh9.9 billion for the financial year ended March 2016. The firm reported a net profit of Sh7.9 billion in a similar period last year.

“The company had a strong performance during the year and closed the year with a good liquidity position. We have chosen to recommend the dividend payout... the company has sufficient liquidity to fund its deal pipeline,” James Mworia, the Centum Group CEO, said at an investment briefing yesterday.

This means that the company will pay out Sh665 million in dividends. The last time the company paid dividends was in March 2008.

But it’s the firm’s employees who will reap the biggest benefits from its performance after it said it had set aside Sh550 million this year for bonuses to be paid in the next three years. Last year, the company paid its employees Sh1 billion in bonuses.

“The bonus that has accrued now is Sh550 million. We will repay it in the next three years and this is used as an employee retention tool,” Mworia said.

Its revenues more than doubled to Sh24.2 billion compared to Sh11.8 billion recorded the previous period. It said the performance was boosted by its earnings from disposals of investments after it exited AON, an increase in value of property held and higher dividends from portfolio companies.

The company is implementing an ambitious investment strategy that has seen it venture in seven sectors among them real estate, financial services, fast moving consumer goods, power, agribusiness, healthcare and education.

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