Marketing services firm WPP Scangroup has announced plans to write off up to KSh4.7 billion investments in its subsidiaries.
The firm has thus transferred the amount from its share premium account to its merger reserve account from which it can absorb the impairments without hurting its earnings.
The manouvre has seen the share premium account –representing the value of shares acquired by shareholders above their nominal price— drop to KSh4.4 billion in the review period from KSh9.1 billion in 2020.
WPP ScanGroup Plc made a net loss of KSh37.9 million at the close of financial year ended 31st December 2021 from a net loss of KSh1.7 billion in 2020.
The Group, which is made up of marketing services companies whose offerings include Advertising, Branding and Communication, Consulting, Mar-Tech Solutions, Managing Media Investments, Public Relations and Influence, recorded a pre-tax profit of KSh134.1 million in 2021 from a pre-tax loss of KSh1.5 billion in 2020.