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Total Q3 results point to a rosy outlook for KK
Rank: Elder Joined: 6/2/2008 Posts: 1,438
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@milken. I know the road system in TZ has been pretty awful, but how about the railway to Kigoma and Mwanza?
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Rank: Member Joined: 4/25/2008 Posts: 192 Location: Nairobi
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Currently, only Kenya companies can import petroleum products through Kenya (i.e. use the KOSF jeety and KPC). This means that even big companies (multinationals included)in Ug and neighbouring countries have to buy product from Kenyan companies or establish offices in Kenya) so as to receive product. This is how KK and other Kenya companies make money. They are big and are able to import huge quantities that ensure no stock outs, they can use the Kenyan pipeline system for storage speculatively and thus outdo other competitors in RW, Burundi and UG. In the eventuality that Kenya and neighbouring countries are to source product from Ug, then it will be a free for all with companies including small ones going for one truck in Uganda for their station. This will lead to stiff competition and erosion of margins (small company=small overhead which will see KK not making the return they are making now. Itari muting'oe ihuragwo ngi ni Ngai
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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cnn wrote:@mwanahisa,my EPS come to 1.98 against 1.72 at half year,which still shows .26 EPS for third quarter.The question is whatever caused the slow down in Total during the quarter also affected KK.Half year KK made .88 per share.Giving it the same third quarter performance to Total and in direct proportionality (a too conservative approach)the EPS drop to .13 for the three months and total earnings of 1.01 at third quarter.Throw in a good fourth quarter,KKs regional reach and a management which i like and full year EPS at around kSh 1.40 is possible.Where is your money? I had forgotten to respond to this. Last year Total issued 123,478,000 preference shares which have all the rights that ordinaries have other than voting. I have therefore diluted Total's EPS in my computations. My money is on KK. I have a 100 Total shares to be allowed into their meetings. They ocassionally serve alcohol at some of their shareholder cocktails, but these have been rather scarce of late!!
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Rank: Member Joined: 4/25/2008 Posts: 192 Location: Nairobi
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@mwanahisa. I know the road system in TZ has been pretty awful, but how about the railway to Kigoma and Mwanza? Guys use Kigoma for DRC, Burundi and Rwanda (by road or barge). Even if you moved product to Mwanza by rail, How will it move to Kampala about 900KM? Itari muting'oe ihuragwo ngi ni Ngai
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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milken wrote:Currently, only Kenya companies can import petroleum products through Kenya (i.e. use the KOSF jeety and KPC). This means that even big companies (multinationals included)in Ug and neighbouring countries have to buy product from Kenyan companies or establish offices in Kenya) so as to receive product. This is how KK and other Kenya companies make money. They are big and are able to import huge quantities that ensure no stock outs, they can use the Kenyan pipeline system for storage speculatively and thus outdo other competitors in RW, Burundi and UG. In the eventuality that Kenya and neighbouring countries are to source product from Ug, then it will be a free for all with companies including small ones going for one truck in Uganda for their station.
This will lead to stiff competition and erosion of margins (small company=small overhead which will see KK not making the return they are making now. Thanks for this info. I will be honest and admit that I did not know that. However, even with the change, KK and others of their ilk will have better economies of scale due to their size. However, should margins thin out that dramatically, KK still has other territories in which to do business.
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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milken wrote:@mwanahisa. I know the road system in TZ has been pretty awful, but how about the railway to Kigoma and Mwanza?
Guys use Kigoma for DRC, Burundi and Rwanda (by road or barge).
Even if you moved product to Mwanza by rail, How will it move to Kampala about 900KM? From Mwanza to Port Bell, You could simply use the Lake. Note, I am guessing here as I not sure whether the infrastructure is in place i.e. steamers, oil jetties etc. Maybe, you know better.
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Rank: Elder Joined: 6/2/2008 Posts: 1,438
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milken wrote:
1. What take over has KK been involved in to justify your outlook?
KK established a branch in Mozambique in July this year. I guess this is still at a nascent stage so it is unlikely to have made much headway as yet, but the Move South strategy is very much in motion. I am not sure, but I think KK also went into Malawi this year.
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Rank: Chief Joined: 1/3/2007 Posts: 18,259 Location: Nairobi
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Folks... the oil in Uganda will not start flowing for a few years! museveni wants another 7-year term coz he wants to kula [a typical corrupt african megalomaniac] once the oil starts flowing... So even if the oil flows (earliest) in 2013, there is no refinery in Uganda... So KK will still export to Uganda through Kenya/Tanzania... Even with a refinery (earliest 2015), KK will still remain a major player since it can import from Uganda to supply Zambia, DRC, Kenya, Rwanda, etc... KK is expanding into Africa & expects to be present in 10 countries by 2013 [new ones on the radar are Mozambique & Zimbabwe] & Kenya will become a smaller portion of the much larger pie! Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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VituVingiSana wrote:
KK is expanding into Africa & expects to be present in 10 countries by 2013 [new ones on the radar are Mozambique & Zimbabwe] & Kenya will become a smaller portion of the much larger pie!
@VVS i'm watching the zimbabwe entry very closely because this is a key growth market they can't afford to lose though i know Mugabe is being bitchy with his indigenization policies.. By the way M7's term will be 7 years not 5... Mark 12:29
Deuteronomy 4:16
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Rank: Chief Joined: 1/3/2007 Posts: 18,259 Location: Nairobi
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guru267 wrote:VituVingiSana wrote:
KK is expanding into Africa & expects to be present in 10 countries by 2013 [new ones on the radar are Mozambique & Zimbabwe] & Kenya will become a smaller portion of the much larger pie!
@VVS i'm watching the zimbabwe entry very closely because this is a key growth market they can't afford to lose though i know Mugabe is being bitchy with his indigenization policies.. By the way M7's term will be 7 years not 5... Erm, I did say 7 years... Not sure what you post you are referring to... Zimbabwe may not be on the table for KK for 2010 or 2011 for now but there are others in the region... Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 1/21/2010 Posts: 6,675 Location: Nairobi
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VituVingiSana wrote:Erm, I did say 7 years... Not sure what you post you are referring to...
@VVS i dont know why I'm always confused when replying your posts...  I meant to say that M7's term is 5 years not 7 Mark 12:29
Deuteronomy 4:16
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Rank: Chief Joined: 1/3/2007 Posts: 18,259 Location: Nairobi
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guru267 wrote:VituVingiSana wrote:Erm, I did say 7 years... Not sure what you post you are referring to... @VVS i dont know why I'm always confused when replying your posts... I meant to say that M7's term is 5 years not 7 LOL... yes, 5 years but he wants to be prez for life... The crook even said back in the day that max should be 2 terms (10 years) for prez... Now he is the longest prez in Africa! I think 24 years! Now he wants another 5??? Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 11/27/2007 Posts: 3,604
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VituVingiSana wrote:guru267 wrote:VituVingiSana wrote:Erm, I did say 7 years... Not sure what you post you are referring to... @VVS i dont know why I'm always confused when replying your posts... I meant to say that M7's term is 5 years not 7 LOL... yes, 5 years but he wants to be prez for life... The crook even said back in the day that max should be 2 terms (10 years) for prez... Now he is the longest prez in Africa! I think 24 years! Now he wants another 5??? i just don't understand how TOTAL's kenya post resulted to the talk of M7 ruling since 1986. African parents don't know how to say sorry.. the closest you will get to a sorry is a 'have you eaten'
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Total Q3 results point to a rosy outlook for KK
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