Car & General recorded a fall in net profits from KSh 225.7 million to KSh 182.4 million. This is a 19 percent drop from its financial performance at the end of September, 2018.
The listed auto and engineering products seller, Car & General(Kenya) Plc, attributes the decline to a tough business environment.
The firm blames a significant increase in storage and demurrage charges for its financial woes.
According to the company, a government directive for all cargo shipped to Mombasa to be transported inland using the Standard Gauge Railway (SGR) is the reason for the increased expenses.
This logistical nightmare, that has since been sorted, spiked cargo clearance expenses by the firm to KSh 188 million. This is compared to KSh 1 million incurred the previous year.
With subsidiaries in Uganda, Tanzania, Rwanda and South Sudan, Car&General recorded an increase in revenue from KSh 10.1 billion to KSh 11.9 billion. The firm earned KSh 255.7 million from its poultry business in Tanzania and KSh 53 million as rental income from its properties in Kenya.
Car& General also owns 26.5 per cent of Watu Credit Limited, a microfinance company in Kenya and has a joint venture with Minerva Fiduciary Services Limited, based in Mauritius.
This firm deals in sale and servicing of commercial engines and power equipment.
Financial results for the year ended 30th September, 2019 indicate that the Group’s cost of sales increased from KSh 8.5 billion in 2018 to KSh 10 billion in 2019. Selling and distribution costs rose from KSh 575.5 million to KSh 631.2 million.
The Group’s largest revenues came from the Kenyan business, where it obtained KSh 7.4 billion compared to KSh 6.9 billion earned the previous financial year.
Its revenue earnings from the Tanzanian business was KSh 3.5 billion, followed by Uganda (KSh 718.5 million), Kibo (KSh 255.7 million) and Rwanda (KSh 16.8 million).
Car&General (Kenya) Plc has notified shareholders that the 80th Annual General Meeting (AGM) will be held in Nairobi on Wednesday, 25th March 2020 at 11.00 a.m.
Shareholders will receive the audited financial statements for the year ended 30th September, 2019 and approve among others a first and final dividend of 80 cents per share as recommended by the Directors.
Car& General is a household name in the motor cycle business with its TVS bikes. It also deals in three wheelers, generators, tyres, and heavy machinery. It owns vast properties in Kenya and Tanzania.
Some of its most popular brands include cummins generators, TVS motorcycles, Piaggio, Garmin, Doosan, Briggs & Stratton, Ingersoll Rand Compressors,Toyota Forklifts, MRF Tyres and Kubota tractors.
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