Centum Investment Company Plc · NSEKE:CTUM
Centum Investment — FY2024 Earnings Presentation
38 slides from Centum Investment's earnings presentation, Jul 30, 2024
Slide 1: FY2024 Investor Briefing & Results Announcement
FY2024 Investor Briefing & Results Announcement For the Period ended 31 March 2024 July 30th, 2024 www.centum.co.ke
Slide 2: Agenda
Agenda. BUSINESS REVIEW Dr. James Mworia – Chief Executive Officer FINANCIAL REVIEW Risper Alaro – Group Finance Director OUTLOOK Dr. James Mworia – Chief Executive Officer Q&A 2
Slide 3: Business Review
BUSINESS REVIEW Dr. James Mworia – Chief Executive Officer 3
Slide 4: Company Overview
BUSINESS REVIEW Dr. James Mworia – Chief Executive Officer Section 1: Company Overview. 4
Slide 5: Our Business Model. Our Competitive Advantage.
Our Business Model. Our Competitive Advantage. Deploy Create & A high-quality portfolio Capital Grow Value IDENTIFY comprising assets with Identifying and deploy capital to potential for both Identify compelling • Institutionalize high quality investment significant yield and opportunities and robus
Slide 6: Company Snapshot | March 2024
Company Snapshot | 31 March 2024 KES Portfolio Allocation Market Capitalisation(1) as of 31 March 2024 6.0 billion Growth Portfolio Marketable Securities KES 94% 6% 41 billion (2) Net Asset Value [ Kes 62.4 NAV per share ] Cumulative dividend KES distribution consistently paid out annually since 201
Slide 7: FY 2009 – FY 2024 Snapshot: 10X
FY 2009 – FY 2024 Snapshot. Annualized Dividend Growth in Return Distribution Shareholders’ Equity Company Snapshot. KES 18.0% 5.1 billion 10X • The shareholders’ equity value at March 2009 was Centum Value creation and distribution (FY2009 - FY2024) Kes 4.1Bn. 50.0 Kes Bn • Centum has since made di
Slide 8: Strategy Update and Performance Overview
BUSINESS REVIEW Dr. James Mworia – Chief Executive Officer Section 2: Strategy Update and Performance Overview. 8
Slide 9: Strategy Evolution – Our Journey
Strategy Evolution – Our Journey - Adapting effectively to our dynamic business environment, Centum has remained resilient to deliver 10x growth in shareholders’ equity through diverse strategies Strategic Themes Portfolio Allocation: marketable securities, controlling stakes Total Assets KES 48 Bn
Slide 10: Strategy Overview – Centum 4.0 scorecard
Strategy Overview – Centum 4.0 scorecard. Strategic Pillars Key Objectives Achievements (FY 2022 – FY 2024) (FY 2020 – FY 2024) Return & Dividend Pay-out Target Achieved Performance Returns & Return (% p.a) 20% -4% • 58% of NAV target realized. Dividend Payout Net Asset Value (Kes Bn) 70.0 41.1 • -4
Slide 11: Centum 5.0 (FY2025–FY2029) Strategic Objectives
Centum 5.0 [ FY2025 – FY2029 ] | Strategic Objectives – Strategic theme: Value optimization. Key Pillars Strategic Objectives Return and ▪ Generate a minimum of 30% annualized return on equity. ▪ Grow Net Asset Value from Kes 41Bn to Kes 152Bn Dividend Pay- ▪ Have at least 5 solid subsidiary compani
Slide 12: Portfolio Review
BUSINESS REVIEW Dr. James Mworia – Chief Executive Officer Section 3: Portfolio Review . 12
Slide 13: Portfolio Review - FY2024 Summary Carrying Value
Portfolio Review - FY2024 Summary Carrying Value 31 March 2024 Shareholder Total Carrying Equity Value Valuation Method Centum's Portfolio Summary - loans Value Nature of Business Sector Stake 31 March 2024 Kes Mn Kes Mn Kes Mn Development of Grade A offices within TRIFIC SEZ Recent transaction Two
Slide 14: Key portfolio updates | March 2024
Key portfolio updates | 31 March 2024 Total Assets - KES 48.2 Bn | Total NAV – 41.1 Bn | NAV Per Share – KES 64.2 Growth assets Cash generating assets Development Co. Land Co. Marketable Securities Portfolio 14
Slide 15: Portfolio review – Two Rivers Land Company SEZ
Portfolio review – Two Rivers Land Company SEZ Centum’s stake: 80.5% Background Business Model A hub for export-oriented service Carrying Value: Kes 10.6Bn ▪ Centum and a consortium of other investors enterprises created TRIFIC SEZ in the financial year ended 31 March 2024. ▪ The investors capitaliz
Slide 16: Portfolio review – Centum Real Estate | Land sales
Portfolio review – Centum Real Estate | [A] Land sales Land Co Centum’s stake: 100% Sales traction; cash collections and profit potential Carrying Value: Kes 23.4Bn 4,221 acres sold; 88% average profit margin Cost Total Value Profit Cash collected Receivables Land sales segment [Land+Infra] (Kes Bn)
Slide 17: Portfolio review – Centum Real Estate | Residential units
Portfolio review – Centum Real Estate | [B] Residential units Dev Co Sales traction; cash collections and profit potential Centum’s stake: 100% 2,113 Units under development are 89% sold Total Cost to Net Cash Total Value Profit Cash collected Receivables Carrying Value: Kes 1.6Bn Residential Units
Slide 18: Portfolio review – Akiira Geothermal
Portfolio review – Akiira Geothermal Centum’s stake: 75% The opportunity Carrying value: Kes 1.0Bn ▪ There is significant and growing demand for green energy in Kenya and beyond. ▪ Akiira Geothermal is strategically well placed to provide base load power to the grid and captive consumers. ▪ To drive
Slide 19: Portfolio review – Longhorn Publishers
Portfolio review – Longhorn Publishers Diversified market presence Centum’s stake: 60.2% Carrying Value: KES 377Mn Market Opportunities 1. Revision of existing titles and introduction of new titles in various markets where Longhorn has presence. 2. Strategic partnerships to leverage tech-driven Stra
Slide 20: Key portfolio updates - Other growth assets
Key portfolio updates - Other growth assets ▪ The bank recorded Kes 2Bn growth total assets in the year ended December 2023, with 22% growth in net interest income for the period. ▪ Centum concluded a partial exit of Sidian Bank and remains with 40% stake. We realized Kes 3.2 Bn in cash proceeds. Ce
Slide 21: Key portfolio updates - Cash generating assets
Key portfolio updates - Cash generating assets ▪ Continues to diversify revenue streams to in-train services, office catering and formation of strategic partnerships for home deliveries. ▪ The business continues to enhance dividend distribution following the rebound of Centum’s Stake | 15% business
Slide 22: Key portfolio updates - Marketable securities portfolio
Key portfolio updates - Cash generating assets MSP Asset Allocation (Kes Mn) Mar 2024 Mar 2023 Cash & Equivalents Marketable Cash & Equivalents 0% 11% 6% 20% Securities Government Bonds (LCY) 14% Government Bonds (LCY) 28% Portfolio 0% Government Bonds (Eurobonds) 0% Government Bonds (Eurobonds) Kes
Slide 23: Financial Review
FINANCIAL REVIEW Risper Alaro – Group Finance Director 23
Slide 24: Company Financial Performance
FINANCIAL REVIEW Risper Alaro – Group Finance Director Section 1: Company Financial Performance . 24
Slide 25: Company Performance Highlights - Total Return Statement
Company Performance Highlights - Total Return Statement. The primary objective of Centum as an investment company is to grow and preserve shareholder value as measured by the Net Asset Value (NAV) of the company. The Total Return Statement shows the shareholder value generated in a period. Performan
Slide 26: Company Cash Flows
Company Cash Flows Kes 3.1 Bn cash generated from operations (annuity income and shareholder loan repayments) while Kes 3.5Bn was realized from disposal of marketable securities. In FY2024 Reconciliation of profit/(loss) to cash flows FY2020 FY2021 FY2022 FY2023 FY2024 Total Highlights: Kes Mn Kes M
Slide 27: Company Statement of Financial Position
Company Statement of Financial Position. Kes Mn Mar 2024 Mar 2023 %Δ Kes Mn Mar 2024 Mar 2023 %Δ Growth portfolio: Borrowings 1,951 2,248 (13%) - Investment in Subsidiaries 30,786 21,991 40% Other Liabilities 5,090 3,521 45% - Debt Investment in Subsidiaries 9,731 8,505 14% Total Liabilities 7,041 5
Slide 28: Company Debt Analysis
Debt Review - Company Debt Analysis. Kes 14.2Bn of debt was repaid in the Centum 4.0 period. Mar-2019 Mar-2020 Mar-2021 Mar-2022 Mar-2023 Mar-2024 Kes Mn Kes Mn Kes Mn Kes Mn Kes Mn Kes Mn Revolving credit facilities/ Term Loan 16,036 6,448 3,106 3,150 1,500 1,054 Overdraft Facility 108 1,037 1,016
Slide 29: Consolidated Financial Performance
FINANCIAL REVIEW Risper Alaro – Group Finance Director Section 2: Consolidated Financial Performance . 29
Slide 30: Statement of Comprehensive Income
Consolidated Financial Statements - Statement of Comprehensive Income. Kes 2.9Bn consolidated profit before tax driven by improved performance across 4 out of the 6 business segments Performance Highlights: ▪ Consolidated P&L aggregates the performance of Kes Mn Mar 2024 Mar 2023 %Δ subsidiaries pro
Slide 31: Statement of Financial Position
Consolidated Financial Statements - Statement of Financial Position. Highlights: Kes Mn Mar 2024 Mar 2023 %Δ Investment portfolio 7,925 7,725 3% ▪ Consolidated Statement of Financial position Loans and advances 271 101 169% aggregates the assets and liabilities of subsidiary companies, net equity va
Slide 32: Shareholder distributions
FINANCIAL REVIEW Risper Alaro – Group Finance Director Section 3: Shareholder distributions - Share buyback update & FY2024 Proposed dividend. 32
Slide 33: Share buyback update
Shareholder distributions - Share buyback update. The primary objective of the Share buyback program was to provide liquidity to the counter, and this has largely been achieved. 45,000,000 10 ▪ Centum initiated the share buyback program on the 6th of Feb 2023 at the 40,000,000 9 Total shares traded
Slide 34: FY2024 Proposed Dividend
FY2024 Proposed Dividend . Kes 210Mn proposed dividend payout with respect to the ▪ The Board proposes to pay out a Financial Year ended 31 March 2024 dividend of Kes 0.32 per share, amounting to Kes 210Mn with respect to the performance recorded in the year Dividend payout ended 31 March 2024 799 7
Slide 35: Outlook
OUTLOOK Dr. James Mworia – Chief Executive Officer 35
Slide 36: FY 2025 Key Focus Areas
FY 2025 Key Focus Areas. Objectives. Actions. Portfolio value optimization • Implementation of business model transformation initiatives to achieve growth in portfolio value e.g TR Land Co. SEZ, Akiira and other portfolio companies. • Monetization of mature growth portfolio assets to unlock capital
Slide 37: Q&A
FY2024 Investor Briefing & Results Announcement Q&A 37
Slide 38: Centum Investment Company Plc contact details
Centum Investment Company Plc Tel +254 20 316303 8th Floor, South Tower, Two Rivers Mobile +254 722 205339 PO Box 10518-00100 Fax +254 20 223223 Nairobi, Kenya Email info@centum.co.ke www.centum.co.ke
Centum Investment Company — FY2024 Earnings Presentation on 6ix