CFC INURANCE HOLDINGS AFTER TAX PROFIT SURGES 73.2%

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CFC Insurance Holdings Limited (CFCIH) have released their results for the Half Year period ending 30^th June 2011

Profits surged with Profit Before Tax up 75% to 441.8 Million

Net Premium Revenue rose an impressive 53.9% to 2.1 Billion

Profit After Tax grew from 193.2 Million to 334.5 Million, an increase of 73.2%

	H1 2010  Kshs.	H1 2011  Kshs.	% CHANGE
NET PREMIM REVENUE	1.4 BILLION	2.1 BILLION	+53.9%
TOTAL INCOME	2.2 BILLION	3.3 BILLION	+54.3%
NET BENEFITS AND CLAIMS	1.04 BILLION	1.4 BILLION	+37.8%
OPERATING PROFIT	228.8 MILLION	413.7 MILLION	+80.8%
PROFIT BEFORE TAX	252.5 MILLION	441.8 MILLION	+75%
PROFIT AFTER TAX	193.2 MILLION	334.5 MILLION	+73.2%
EARNINGS PER SHARE	0.42/=	0.65/=	+54.8%

Commissions nearly tripled from 82 Million to 231.8 Million

CFCIH saw its Investment Income surge by 94.6% to 939.4 Million

Total Expenses and commissions registered a rise of 66.8% from 886.4 Million to 1.48 Billion

Other operating expenses increased by an equally high 55.8% to 1.04 Billion

Management said that the improved performance was a result of operational strategies delivering on the synergy objectives which included last year’s acquisition of Heritage Group and the listing of CFCIH ‘s shares at the NSE this April

The group however realised a significant reduction in Total Comprehensive Income from 1.2 Billion, to a loss of 959 Million. This was blamed on a decline in the fair values of equities listed at the NSE and rising interest rates that negatively affected the valuation of the group’s investments in Government bonds

The Groups operations are still undergoing significant change and will be banking on the improvement of distribution channels as well as introduction of new alternative distribution channels to ensure shareholder value

This is an impressive performance from CFCIH, though the continuing dwindling fortunes of the NSE might knock a bit off their performance at Full Year

The company now trades at a lower Forward P.E of 8.1

TRANSCENTURY LIMITED HALF YEAR 2011 RESULTS

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TransCentury Limited (TCL), a holding company with a focus on infrastructure investment yesterday released their Half Year results for the period ending June 30^th 2011.

The company moved from a pre-tax loss of Kshs. 48.6 Million, to a profit of Kshs. 165.4 Million

Profit After Tax improved to Kshs. 53.9 Million from a loss of Kshs. 167.9 Million

The company was buoyed by a rise in regional sales volumes in the Power Infrastructure decision which pushed revenues up 40% to Kshs. 4.5 Billion.

Operating margins however reduced to 8.9% from 12%

During the period in review, the Tanzanian operation returned to profitability

Net finance costs reduced marginally by Kshs. 4.2 Million to Kshs. 238.5 Million

Total Assets increased by 36% to Kshs. 15.3 Billion

Earlier this month, Rift Valley Railways (RVR), which TCL holds a 34% stake, concluded a $164 Million debt financing package aimed at upgrading rail services

RVR expects to launch its extensive capital investment of $287 Million program imminently now that loan agreements have been signed.

TCL had previously issued a press release indicating that the Company had plans to list an extra 6,912,194 ordinary shares in connection with the company’s Convertible Bond Programme. This will bring the Total Issued Shares to 273,950,284. 144,008,422 shares still remain unissued

Incorporating the extra shares to be listed, projected Earnings Per Share for the full year will be 0.39/= At the current price of 38/=, TCL trades a PE of 96.6

That definitely is too high for anyone’s liking. How the arrangers of the listing came up with a price of 50/= is beyond comprehension

The company closed with a positive cash position of Kshs. 2.5 Billion, from a negative cash of Kshs. 27.4 Million in the corresponding half year in 2010

Debt/Equity ratio reduced to 0.93 from 1.5

Management expects demand to remain strong for the rest of the year and expects production to further increase as key capacity expansion has been completed

CROWN BERGER HALF YEAR 2011 NET PROFIT UP 7.8% TO KSHS. 45.9 MILLION

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CROWN BERGER today morning released their Half Year results for the half year period ending 30^th June 2011

Turnover rose 26.63% to Kshs. 1.81 Billion from Kshs. 1.43 Billion

Net Profit Margin was however down to 2.5% from 3% due to weakening of the Kenya Shilling and high raw material prices

Earnings Per Share went up from Kshs. 1.79/= to Kshs. 1.93/=

	H1 2010 Kshs.	H1 2011 Kshs.	% CHANGE
TURNOVER	1.43 BILLION	1.81 BILLION	+26.63%
NET FINANCE COSTS	22.4 MILLION	14.1 MILLION	-37.15%
PROFIT BEFORE TAX	70.1 MILLION	75.1 MILLION	+7.14%
NET PROFIT	42.5 MILLION	45.9 MILLION	+7.81%
NET PROFIT MARGIN	3%	2.5%	-0.5%
EARNINGS PER SHARE	1.79/=	1.93/=	+7.82%

Total Assets rose 32.81% to Kshs.2.48 Billion

Management noted that “the outlook for the 2^nd Half of the year is a matter of concern due to the current economic situation in the country and the board has taken measures to sustain profitability with a positive note”

No interim dividend was declared

Crown Berger finished the day at NSE trading as the highest gainer. It traded 2,800 shares at Kshs. 29.00 ending up higher by 16%

At that price, it is trading at a forward Price/Earnings ratio of 7.5

TOTAL KENYA HALF YEAR 2011 ANALYSIS

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TOTAL KENYA (TOTAL) have released their results for the half year period ending 30^th June 2011

Net Profit was down 73.6% to Kshs. 79.7 Million from Kshs. 302.3 Million

Gross Profit declined 23% to Kshs. 2.63 Billion

The results pale in comparison to KenolKobil’s 1^st Half 2011 results which saw Profit After Tax rise by 82.9% to Kshs. 2.1 Billion, no doubt receiving a boost from its subsidiaries. Many would love to see the performance of KenolKobil’s Kenyan unit, but management declined to release the figures showing the contribution of each country by profits.

Gross Profit Margins was down 2.2% to 4.54%. Its fellow listed oil marketer had Gross Profit Margins of 8.1%

Total Assets were up 17.7% to Kshs. 35.76 Billion

	HALF YEAR 2010          Kshs.	HALF YEAR 2011          Kshs.	% CHANGE
TURNOVER	39 BILLION	44.72 BILLION	+14.7%
COST OF SALES	28.6 BILLION	36.3 BILLION	+26.8%
GROSS PROFIT	2.63 BILLION	2.03 BILLION	-23%
GROSS PROFIT MARGIN	6.76%	4.54%	-2.2%
DEPRECIATION AND AMORTISATION	444.7 MILLION	530 MILLION	+19.2%
OPERATING PROFIT	1.02 BILLION	515.5 MILLION	-49.7%
NET FINANCE COSTS	543.3 MILLION	396 MILLION	-27.1%
NET PROFIT	302.3 MILLION	79.7 MILLION	-73.6%

The company attributed the reduced performance to various challenges facing the oil industry in Kenya, key among them the impact of price controls that were introduced in December 2010.

TOTAL also blamed inefficiencies in the fuel supply chain

Sales Volumes were down 13.7% from 493 KMT to 425 KMT. The rise in Turnover was as a result of an increase in product costs due to high international oil prices

Other Income rose by 790% from Kshs. 40.5 Million to Kshs. 360.4 Million, including Kshs. 200 Million from the disposal of company assets as was stipulated by the Government of Kenya during the acquisition of the Chevron business

Finance costs decreased due to lower average interest rates compared to the same period in 2010

The weakening of the Kenya shilling played its part resulting in TOTAL’s operating expenses rising by 11% due to foreign-currency denominated costs

The company still has a Medium Term Loan of Kshs. 702 Million in its books. Short Term Borrowings shot up by 141% to Kshs. 14.2 Billion from Kshs. 5.9 Billion. This was to finance higher Working Capital requirements as a result of the rise in International oil prices

Cash generated from operations is at negative Kshs. 8 Billion. The closing cash position for the period is Kshs 14.1 Billion compared to Kshs. 10.5 Billion as at 30^th June 2010

TOTAL paid Kshs. 396 Million in interest, from Kshs. 543 Million in the corresponding half in 2010

Management blamed the Energy Regulatory Commission for underestimating costs in their formula for determining maximum pump prices and the lag effect between rising international prices and the period when they are recognized in the formula

The short-term to medium-term picture looks gloomy for TOTAL and its Managing Director, Alex Vovk, is hoping for a “reasonable solution to be implemented by the Government to address shortfalls in the pricing formula”

The firm also continues to service loans it took for acquiring the Chevron business

TOTAL KENYA’s market share now stands at 22.6% from 27.6% in June 2010

Half Year Earnings Per Share is at Kshs. 0.46/=

At the price as at 25^th August 2011, the share is trading at a Forward Price Earnings ratio of 23.4

Meanwhile, assuming a Full Year Earnings Per Share of 1.95/= for KenolKobil, it is trading at a forward P.E of 5.4 

STANDARD CHARTERED BANK OF KENYA HALF YEAR 2011 ANALYSIS

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Yesterday evening Standard Chartered Bank Of Kenya (SCBK) announced its financial results for the Half Year ending June 30^th 2011

Profit Before Tax slumped 14.4% to hit Kshs. 3.47 Billion. Profit After Tax is now at Kshs. 2.5 Billion, 11.9% less than the corresponding period last year

The Bank was hit by the rise in interest rates which caused the value of SCBK’s bond portfolio to reduce

SCBK reduced its investment in Government Securities by 40.4% to Kshs. 31.5 Billion from Kshs. 52.8 Billion

Cost:Income ratio rose from 42.53%  to 51.37%. It was helped on its way by the 22.2% rise in Total Operating Expenses to Kshs. 3.66 Billion from the previous year’s Kshs. 3 Billion

These were not the sort of results SCBK shareholders were hoping for, but the surge in Net Loans and Advances, which went up by Kshs. 33.4 Billion or 66.6%, is bound to put a smile on their faces

H1 2010 vs. H1 2011 Analysis

	H1 2010  Kshs.	H1 2011  Kshs.	% CHANGE
TOTAL ASSETS	131.2 BILLION	153.3 BILLION	+16.8%
NET LOANS AND ADVANCES	50.2 BILLION	83.7 BILLION	+66.6%
CUSTOMER DEPOSITS	98.9 BILLION	109 BILLION	+10.5%
LOAN:DEPOSIT RATIO	50.81%	76.61%	+25.8%
TOTAL INTEREST INCOME	5.05 BILLION	5.08 BILLION	+0.6%
TOTAL INTEREST EXPENSE	1.05 BILLION	523 MILLION	-50.4%
NET INTEREST INCOME	4 BILLION	4.5 BILLION	+12.4%
TOTAL OPERATING INCOME	7.05 BILLION	7.13 BILLION	+1.2%
TOTAL OPERATING EXPENSE	3 BILLION	3.66 BILLION	+22.2%
COST:INCOME RATIO	42.53%	51.37%	+8.8%
PROFIT BEFORE TAX	4.05 BILLION	3.5 BILLION	-14.4%
PROFIT AFTER TAX	2.84 BILLION	2.5 BILLION	-11.9%

Customer Deposits were up 10.5% to Kshs. 109 Billion.

The surge in Net Loans and advances pushed up the Loan:Deposit ratio to 76.61% from 50.81%

Interest Income from Loans and Advances as a percentage of Total Interest Income stands at 72.26% in comparison with 58.22% in H1 2010.

With the reduction of investment in Government Securities, interest income from them now comprise 25.69% of Total Interest Income, down from 38.37% in the corresponding half last year

Foreign Exchange Income was up 4.5% to Kshs. 847 Million

Total Fees and Commissions were significantly up by 55.3%, from Kshs. 1.13 Billion to Kshs. 1.76 Billion as a result of “significant growth in loans and advances, trade finance and improved revenues from our custodial business”

Net Non Performing loans were cut by half to Kshs. 313 Million

Total Interest Expenses was down a huge 50.4% to Kshs. 523 Million after the bank significantly cut its cost of funds

‘Other Income’ fell by 13.77% to, following the rise in interest rates which devalued the bond portfolio

Staff Costs registered a slight increase of 4.6% to stand Kshs. 1.7 Billion

Q1 2011 vs. Q2 2011 (Quarter on Quarter Analysis)

	Q1 2011          Kshs.	Q2 2011          Kshs.	% CHANGE
TOTAL INTEREST INCOME	2.45 BILLION	2.63 BILLION	+7.3%
TOTAL INTEREST EXPENSE	242.6 MILLION	280.6 MILLION	+15.7%
NET INTEREST INCOME	2.2 BILLION	2.32 BILLION	+5.0%
TOTAL OPERATING INCOME	4.11 BILLION	3.02 BILLION	-26.5%
TOTAL OPERATING EXPENSE	1.8 BILLION	1.87 BILLION	+4.0%
COST:INCOME RATIO	43.69%	61.83%	+18.1%
PROFIT BEFORE TAX	2.31 BILLION	1.15 BILLION	-50.2%
PROFIT AFTER TAX	1.64 BILLION	859.4 MILLION	-47.6%

The Quarter on Quarter analysis lays bare the tough Q2 that SCBK experienced. Cost:Income ratio for the 2^nd Quarter alone is at 61.83%, from 43.7% in Q1

The Bank made 50.2% less in Profit Before Tax in Q2 2011 than in Q1 2011 and 47.6% less in Profit After Tax

Earnings Per Share was down 16.6% to 8.71/=

With yesterday’s closing price of Kshs. 209/=, the bank is trading a Forward P.E of 12, way above of its peers