TotalEnergies Marketing Kenya Plc – HY22 net sales up 34% spurred by increased sales and fuel prices

SUMMARY OF UNAUDITED FINANCIAL STATEMENTS FOR THE PERIOD ENDED SO JUNE 2022

COMMENTARY ON 2022 UNAUDITED HALF YEAR RESULTS

The Board of Directors of TotalEnergies Marketing Kenya PLC is pleased to announce the unaudited half-year results for 2022.

Operating environment
During the period, international oil and gas prices, while being volatile, have continued to rise due to market disruptions linked to geopolitical conflicts. These have exacerbated the upward trend of fuel prices in the country as well as working capital requirements of the Company.

Financial Performance
The Company’s performance remained resilient with positive profit before tax of KShs 1,236 million (2021: KShs 2,483 million).

Net sales increased by 34% in the period resulting majorly from sales performance and the increased fuel prices. The Company’s gross profit decreased to KShs 4,015 million (2021: KShs 4,667 million) mainly due to lag in price adjustment arising from a sharp increase in fuel prices. Other income decreased to KShs 748 million (2021: KShs 951 million) due to the absence of a non-recurring sundry income arising from gain on disposal of land assets that was realized in 2021. However, the revenues from diversified investments in Shops, Food and Services (SFS) and income from partnerships with third parties increased in the period compared to 2021. The increase in operating expenses is mainly attributable to the increased business activities post-Covid and depreciation arising from increased investments. The increase in working capital requirements emanating from increase in oil prices and compensation from the government fuel stabilization program led to increased financing costs in the review period.

The Foreign Exchange loss increased to KShs 48 million (2021: KShs 3 million) mainly due to the sharp depreciation of the Kenya Shilling against the US Dollar in the period. The Company’s cashflow position remained strong given the effective management of working capital.

Dividend
The Board of Directors does not recommend payment of an interim dividend.

Outlook
The business environment remains challenging due to the volatility and high levels of global fuel prices. The Company’s priority is to continue investing in profitable and sustainable projects, generate positive cashflows and maintain a strong balance sheet. Despite this particularly challenging context, the Board is confident that the mitigating measures and action plans adopted by Management will yield positive results in the remaining part of the year.

By order of the Board

Eric FANCHINI
Managing Director
March 31, 2022

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