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Centum 2019/2020
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Kibe21
#141 Posted : Wednesday, May 05, 2021 7:54:56 PM
Rank: New-farer

Joined: 8/1/2018
Posts: 60
Location: Nairobi
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?
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Ericsson
#142 Posted : Thursday, May 06, 2021 1:12:24 AM
Rank: Elder

Joined: 12/4/2009
Posts: 10,804
Location: NAIROBI
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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watesh
#143 Posted : Thursday, May 06, 2021 8:19:20 AM
Rank: Veteran

Joined: 8/10/2014
Posts: 992
Location: Kenya
Ericsson wrote:
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .


They just banked ksh2 billion cash in land sales in Vipingo during a pandemic. The deal pipeline is an estimated 8 billion. The gains are not reflected in the income statement since the revaluation gains were already recognized in the comprehensive income statement and these were done at their current valuations. Pre-sold housing units stand at 10bn with a profit potential of 4bn. Cash collections stand at Ksh230 million a month. These sales wont come into the income statements till they are completed and handed over. I think the real estate is doing just fine given the economic conditions. After years of waiting, they are converting those assets into cash.

This year there is no major asset sale hence the profit warning. Centum has a market cap of ksh10bn vs Ksh8.3 bn in cash, equities, fixed income and mutual funds. The rest of the businesses they own (including real estate) are being valued at Ksh1.7 billion. I see opportunity.
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Ericsson
#144 Posted : Thursday, May 06, 2021 10:17:51 AM
Rank: Elder

Joined: 12/4/2009
Posts: 10,804
Location: NAIROBI
watesh wrote:
Ericsson wrote:
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .


They just banked ksh2 billion cash in land sales in Vipingo during a pandemic. The deal pipeline is an estimated 8 billion. The gains are not reflected in the income statement since the revaluation gains were already recognized in the comprehensive income statement and these were done at their current valuations. Pre-sold housing units stand at 10bn with a profit potential of 4bn. Cash collections stand at Ksh230 million a month. These sales wont come into the income statements till they are completed and handed over. I think the real estate is doing just fine given the economic conditions. After years of waiting, they are converting those assets into cash.

This year there is no major asset sale hence the profit warning. Centum has a market cap of ksh10bn vs Ksh8.3 bn in cash, equities, fixed income and mutual funds. The rest of the businesses they own (including real estate) are being valued at Ksh1.7 billion. I see opportunity.


Real estate will struggle for a while due to deterioration of disposable income.
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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VituVingiSana
#145 Posted : Thursday, May 06, 2021 10:58:18 AM
Rank: Chief

Joined: 1/3/2007
Posts: 18,346
Location: Nairobi
watesh wrote:
Ericsson wrote:
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .


They just banked ksh2 billion cash in land sales in Vipingo during a pandemic. The deal pipeline is an estimated 8 billion. The gains are not reflected in the income statement since the revaluation gains were already recognized in the comprehensive income statement and these were done at their current valuations. Pre-sold housing units stand at 10bn with a profit potential of 4bn. Cash collections stand at Ksh230 million a month. These sales wont come into the income statements till they are completed and handed over. I think the real estate is doing just fine given the economic conditions. After years of waiting, they are converting those assets into cash.

This year there is no major asset sale hence the profit warning. Centum has a market cap of ksh10bn vs Ksh8.3 bn in cash, equities, fixed income and mutual funds. The rest of the businesses they own (including real estate) are being valued at Ksh1.7 billion. I see opportunity.

Applause Applause Applause I am trying to buy more but I have little cash on hand.
I have given up on the kelele ya chura.

As you said, the recognition of profits is about timing.

- Non-cash FV gains recognized earlier as per IFRS.
- Cash inflow not in the P&L but shows up in the CF statement.
- "Profits" (a mix of cash and non-cash) only show up after the units are handed over.

The non-cash, non-real estate assets took a beating thanks to COVID but some may come out stronger eg Isuzu and Longhorn. The latter was forced to digitize its content and that should help in the future.

Some e.g. Sabis will need to figure out what's next. Akiira will take longer than anticipated.

And the best thing is that Centum has cash. The Debt:Equity ratio has been reducing.

AMU
If the LNG pipeline is built (DSM-MSA-Lamu) or TZ sells KE LNG which can also be shipped then even Amu may be built though this would take much longer than anticipated. When this happens, a potential write-back (though non-cash at that point) is possible.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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watesh
#146 Posted : Thursday, May 06, 2021 11:15:23 AM
Rank: Veteran

Joined: 8/10/2014
Posts: 992
Location: Kenya
VituVingiSana wrote:
watesh wrote:
Ericsson wrote:
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .


They just banked ksh2 billion cash in land sales in Vipingo during a pandemic. The deal pipeline is an estimated 8 billion. The gains are not reflected in the income statement since the revaluation gains were already recognized in the comprehensive income statement and these were done at their current valuations. Pre-sold housing units stand at 10bn with a profit potential of 4bn. Cash collections stand at Ksh230 million a month. These sales wont come into the income statements till they are completed and handed over. I think the real estate is doing just fine given the economic conditions. After years of waiting, they are converting those assets into cash.

This year there is no major asset sale hence the profit warning. Centum has a market cap of ksh10bn vs Ksh8.3 bn in cash, equities, fixed income and mutual funds. The rest of the businesses they own (including real estate) are being valued at Ksh1.7 billion. I see opportunity.

Applause Applause Applause I am trying to buy more but I have little cash on hand.
I have given up on the kelele ya chura.

As you said, the recognition of profits is about timing.

- Non-cash FV gains recognized earlier as per IFRS.
- Cash inflow not in the P&L but shows up in the CF statement.
- "Profits" (a mix of cash and non-cash) only show up after the units are handed over.

The non-cash, non-real estate assets took a beating thanks to COVID but some may come out stronger eg Isuzu and Longhorn. The latter was forced to digitize its content and that should help in the future.

Some e.g. Sabis will need to figure out what's next. Akiira will take longer than anticipated.

And the best thing is that Centum has cash. The Debt:Equity ratio has been reducing.

AMU
If the LNG pipeline is built (DSM-MSA-Lamu) or TZ sells KE LNG which can also be shipped then even Amu may be built though this would take much longer than anticipated. When this happens, a potential write-back (though non-cash at that point) is possible.


Sabis projected to break even in the financial year ending March 2022. Akiira will definitely take time but its valuation is small. Isuzu is back to paying dividends and Longhorn may be challenged in Kenya because of the school closure but they more than doubled revenue in Uganda and also had significant growth in Tanzania. Expansion to Central Africa has began.
Amu was written off back in the previous financial year.
Sidian Bank is still profitable and once CBK allows banks to utilize the revoked interest rate cap, we may see some growth and hopefully pay dividends to Centum by 2025.
Greenblade growers will start paying dividends going forward and from Mworia's tweet they approved 50% increase in production capacity for export.
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watesh
#147 Posted : Thursday, May 06, 2021 11:20:52 AM
Rank: Veteran

Joined: 8/10/2014
Posts: 992
Location: Kenya
Ericsson wrote:
watesh wrote:
Ericsson wrote:
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .


They just banked ksh2 billion cash in land sales in Vipingo during a pandemic. The deal pipeline is an estimated 8 billion. The gains are not reflected in the income statement since the revaluation gains were already recognized in the comprehensive income statement and these were done at their current valuations. Pre-sold housing units stand at 10bn with a profit potential of 4bn. Cash collections stand at Ksh230 million a month. These sales wont come into the income statements till they are completed and handed over. I think the real estate is doing just fine given the economic conditions. After years of waiting, they are converting those assets into cash.

This year there is no major asset sale hence the profit warning. Centum has a market cap of ksh10bn vs Ksh8.3 bn in cash, equities, fixed income and mutual funds. The rest of the businesses they own (including real estate) are being valued at Ksh1.7 billion. I see opportunity.


Real estate will struggle for a while due to deterioration of disposable income.


For sure it will take a while to recover due to financing challenges but it will come back. Patience....
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aemathenge
#148 Posted : Thursday, May 06, 2021 11:40:17 AM
Rank: Elder

Joined: 10/18/2008
Posts: 3,434
Location: Kerugoya
Ericsson wrote:
Real estate will struggle for a while due to deterioration of disposable income.


If I may, allow me to present a dissenting view.

Kenya is a "haven".

Ordinary Kenians may be facing disposable income challenges but not the tenderpreneurs and "launders", from all over East and Central Africa, seeking parking for their ill-gotten wealth.

On this alone, Thentum and its real estate component is a buy for me.

May the price keep falling.

Let me rephrase. Come, Baby, come.
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Ericsson
#149 Posted : Thursday, May 06, 2021 11:41:11 AM
Rank: Elder

Joined: 12/4/2009
Posts: 10,804
Location: NAIROBI
VituVingiSana wrote:
watesh wrote:
Ericsson wrote:
Kibe21 wrote:
Ericsson wrote:
Centum share price hits fresh 8-year low of ksh.14.90


Fear of a terrible performance FY20 perhaps?


Centum needs a Britam like cleanup with a new CEO.
Mworia has run out of ideas and outlived his usefulness.
Centum is now stuck with dead real estate that are not injecting any cashflows .


They just banked ksh2 billion cash in land sales in Vipingo during a pandemic. The deal pipeline is an estimated 8 billion. The gains are not reflected in the income statement since the revaluation gains were already recognized in the comprehensive income statement and these were done at their current valuations. Pre-sold housing units stand at 10bn with a profit potential of 4bn. Cash collections stand at Ksh230 million a month. These sales wont come into the income statements till they are completed and handed over. I think the real estate is doing just fine given the economic conditions. After years of waiting, they are converting those assets into cash.

This year there is no major asset sale hence the profit warning. Centum has a market cap of ksh10bn vs Ksh8.3 bn in cash, equities, fixed income and mutual funds. The rest of the businesses they own (including real estate) are being valued at Ksh1.7 billion. I see opportunity.

Applause Applause Applause I am trying to buy more but I have little cash on hand.
I have given up on the kelele ya chura.

As you said, the recognition of profits is about timing.

- Non-cash FV gains recognized earlier as per IFRS.
- Cash inflow not in the P&L but shows up in the CF statement.
- "Profits" (a mix of cash and non-cash) only show up after the units are handed over.

The non-cash, non-real estate assets took a beating thanks to COVID but some may come out stronger eg Isuzu and Longhorn. The latter was forced to digitize its content and that should help in the future.

Some e.g. Sabis will need to figure out what's next. Akiira will take longer than anticipated.

And the best thing is that Centum has cash. The Debt:Equity ratio has been reducing.

AMU
If the LNG pipeline is built (DSM-MSA-Lamu) or TZ sells KE LNG which can also be shipped then even Amu may be built though this would take much longer than anticipated. When this happens, a potential write-back (though non-cash at that point) is possible.



The LNG plant is for KENGEN and it will be built in Kilifi.
It's in KENGEN strategic plan.
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Ericsson
#150 Posted : Thursday, May 06, 2021 11:43:28 AM
Rank: Elder

Joined: 12/4/2009
Posts: 10,804
Location: NAIROBI
aemathenge wrote:
Ericsson wrote:
Real estate will struggle for a while due to deterioration of disposable income.


If I may, allow me to present a dissenting view.

Kenya is a "haven".

Ordinary Kenians may be facing disposable income challenges but not the tenderpreneurs and "launders", from all over East and Central Africa, seeking parking for their ill-gotten wealth.

On this alone, Thentum and its real estate component is a buy for me.

May the price keep falling.

Let me rephrase. Come, Baby, come.


Real estate is now the worse for tenderpreneurs and launders.Its one of the reasons of the slump.
Kwa ground vitu ni tofauti
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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