Centum Investment Company Plc has announced that it has reported a Ksh. 812.8 million net profit for the financial year ended March 2025. This is a 69% decline in net profit as compared to the Ksh. 2.6 billion the investment company reported in the previous year.
The drop, which aligns with an earlier profit warning, was primarily driven by a significant reduction in non-cash fair value gains from the company’s real estate portfolio.
The company’s total assets grew by 8% to Ksh. 82.35 billion, and its net asset value (NAV) per share increased by 9% to Ksh. 66.93. This underlying growth points to a divergence between paper valuations and the company’s fundamental health.
A key highlight of the year was Centum’s aggressive debt reduction as part of its ongoing 5.0 strategy. The company repaid Ksh. 1.2 billion in investment acquisition debt, leading to a 32% reduction in finance costs and an low net debt-to-equity ratio of just 1.5%.
Performance across Centum’s business segments was a mixed bag. The Financial Services and Investment Operations units both swung from losses to profits of Ksh. 90 million and Ksh. 1.18 billion, respectively. This was contrasted by the Centum Real Estate segment, where profit halved to Ksh. 1.5 billion as fair value gains fell to Ksh. 2 billion from Ksh. 3.7 billion amid softer home sales. The Two Rivers SEZ profit also fell by 97%, a drop attributed to large one-off gains recorded in the prior year.
In a move to generate liquidity and reward shareholders, Centum monetized part of its Sidian Bank stake, contributing to Ksh. 3.1 billion in free cash flow. This supported debt repayment and allowed the company to maintain its Ksh. 0.32 per share dividend and initiate a share buyback program.
The financial year’s results underscore the challenges of a valuation-heavy earnings model.