TransCentury Group (TC Group) has reported a 34% revenue growth for the year ended December 31st 2019. This was driven by good performance especially in two of its subsidiaries; Tanelec Limited and AEA Limited. The two subsidiaries registered 56.8% and 89.7% revenue growth respectively.

The company reduced its net loss by 12.4 per cent during the financial year under review on improved revenue, driven by the performance in two of its subsidiaries.

The Group had incurred a loss of Ksh. 3.5 billion in 2018 and Ksh. 4.33 billion in 2017. By then, its current liabilities had exceeded current assets by Ksh. 10.36 billion.

Tanelec Limited, headquartered in Arusha, Tanzania, is the leading manufacturer and distributor of transformers in the region. AEA Limited, headquartered in Nairobi, Kenya, provides solutions that enhance infrastructure efficiency and sustainability across the region.

The Group has continued to explore commercial opportunities in line with its strategic plan through diversification of products, services, and geographical reach. The gains made have resulted in the Group returning to a positive operating profit.

Since 2016 the Group has reduced 40% of commercial debt, increased debt tenure with most tenures falling between 5-10 years and reduced debt service cashflow. Significant progress in debt restructure has provided the businesses with the opportunity to access the much-needed working capital. This has allowed the businesses in the Group to redirect more of the operating cash to fund the working capital.

Through increased efficiency and decisive actions to safeguard value by restructuring non-performing businesses, the Group has also significantly reduced operating expenses, with a 19.5% reduction in 2019 and upto 46% since 2016. However, as a result of the decision to restructure non-performing entities, there was a one-off impairment loss of Ksh. 2.8 billion. This was related to goodwill carried in one of the scaled down businesses, without which the Group would have achieved a positive Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)

Despite the significant one off non-operating impairment loss, the Group reduced the loss before tax by 12.9% with the loss after tax declining by 12.4%.

Speaking at the release of the financial results, TC Group CEO Mr. Ng’ang’a Njiinu said, “The aggressive top line growth despite scaling down in some of the businesses, confirms that TC capital re-allocation strategy and focus on key levers in the turnaround plan is bearing fruit. In 2019, we strategically scaled down operations in some of our portfolio businesses whose operating environment was incongruent with TC strategy and not supportive of the turnaround.”

The Group’s performance in the 1st half of 2020 was impacted by the effects of COVID-19 pandemic which disrupted demand and supply chains globally, resulting in a 21% decline in revenue as compared to the same period in 2019. On the other hand, the Group continued to deliver on its commitment to enhance efficiencies by recording a 20% savings in operating expenses in line with our strategic plan.

While commenting on the effects of the pandemic, Njiinu added, “We saw a strong rebound in the second half of the year that will substantially reverse the impact of the pandemic on the first half of the year,”

For the last 4 years, TC has focused on a four pronged turnaround plan that has aimed at Delivering commercial opportunities, debt reprofiling to match cashflows, fundraising to unlock growth and accelerating execution of emerging opportunities.

The Group closed 2020 with a confirmed order book of Ksh. 14 billion, thus the focus to raise funds and execute on orderbook.