Profitability driven by ksh.1.244bn realised gains from disposal of Gen Africa.
GenAfrica achieving an IRR of 29%.

James Mworia;
We need to renew the capital structure of the business. We want the shareholders to have great returns.
We are targeting to pay debt at individual businesses and not at the group level.
On the outlook, to optimize the gross return, we are planning on robust exit pipeline of mature assets across the portfolio.

To reduce debt at Centum level, we will utilize part of exit proceeds to completely pay down long term debt as it matures

Debt distress at play.

Been looking to diversify and include a blue chip with high potential for capital gains...(because dividends don't multiply wealth fast enough, and high-beta stocks will ruin quality of sleep).

Settled on Centum with its discount on NAV, plus the headstrong management that has a firm handle on things.

My one concern is the circa Sh50 billion in a fresh private equity (PE) being sought, how prudently it will be used, and its impact on the balance sheet. But seeing the track record of the board in selecting firms to sink money into (plus the insistence on focusing on cash generating companies, and not greenfield ventures or turn-around types), am optimistic.

im also in the process of changing my attitude towards centum.I went into their historical background and i liked the initial purpose of forming it.

Signifies an oncoming mini bull run

Sidian bank has posted a KSh 392 million loss in 2018, an improvement from the KSh422 million loss posted in 2017. The loss resulted from higher operating expenses which shot up by 13 per cent to reach KSh3.7 billion. Net operating income grew by 24 per cent to land at KSh2.1 billion from KSh1.7 billion booked the previous year.

The bank is a subsidiary of Centum Holdings and is primarily focused on lending to small and medium-sized enterprises.

Income from loans and advances to customers fell by 3 per cent attributed to the cap on lending rates. The lender’s investment in government paper increased by at least 75 percent.

Customer deposits, on the other hand, grew by 33% from KSh 12.8 billion to KSh17 billion. Similarly, its loans and advances jumped up 15 per cent to KSh 13 billion.

Given the current mood and unlikeliness of the Interest Cap being lifted, it makes sense to do so.
Acknowledge the hurt. Centum needs to reduce the valuation is has for Sidian from 1.4x BV to 1.0x (at most).

They'll have to deal with the debt issue which is my biggest worry and may that mean selling a valuable business to raise cash?

What about future cash flows then? Because if they sell a business with good cash flow like their beverage business for example that won't be good long term given how their other units like Real Estate, Sidian are struggling.I like Centum but eh I'm somehow skeptical to buy some more..

Back to buy zone.

Jubilee Manifesto