Centum Investment Company's net loss for the six months ended September 2025 shrank 6 percent to Sh326.14 million, helped by a tax credit that partially offset a threefold jump in losses before tax.
The half-year net loss was an improvement from Sh346.64 million net loss in the prior similar period. This was on the back of the group benefitting from a Sh296.71 million tax credit that contrasted with the prior period’s Sh161.5 million tax expense.
Centum owns 11 subsidiaries including Centum Real Estate (Centum Re), Two Rivers Development Limited, Longhorn Publishers, Nabo Capital Limited, Two Rivers Land Company (SEZ) Limited and Jafari Credit Limited. It also has two associates and about four joint ventures.
The group’s pre-tax loss had widened more than three times to Sh622.85 million from Sh185.14 million in the previous period as four of the six business units posted losses.
The tax credit that softened the loss came from two subsidiaries.
“The higher income tax credit is driven by the recognition of deferred tax assets in Longhorn Publishers Plc and Two Rivers Land Co. (SEZ) Ltd.
In the prior period, the group incurred a one-off capital gains tax charge following the increase in the capital gains tax rate from 5 percent to 15 percent affecting Centum Real Estate,” said the firm.
The half-year under review had two business lines posting profits. The net profit from the financial services business dropped by a third to Sh53.74 million from Sh80.16 million, while net earnings from investment operations fell 31.6 percent to Sh388.9 million from Sh561.72 million.
The trading business posted a loss of Sh296.96 million from Sh306.01 million in the previous period on reduced sales while Centum Re narrowed its loss by 46.6 percent to Sh88.33 million.
Centum said the performance in the real estate subsidiary was as a result of a revenue-expense mismatch occasioned by the international accounting rules.
The firm explained that the current sales in real estate will be recognised in subsequent periods when completion and payment is made yet all operating expenses including marketing costs for ongoing projects have to be recognised immediately they are incurred.
“Revenue is recognised only upon completion and full payment for units. Units recognised in the half year ended September 2026 relate mainly to earlier projects with lower historical gross margins,” said the firm.
Two Rivers Development Limited, which is 60 percent owned by Centum, saw its loss widen to Sh90.68 million from Sh67.7 million.
This was attributed to power and water utility subsidiaries under TRDL, which Centum said are below the utilisation levels required to reach break-even point.
The half-year period saw Two Rivers Special Economic Zone (SEZ) loss more than double to Sh584.5 million from Sh288.04 million, contributing to the increased pre-tax loss for Centum Investment group.
“The SEZ results primarily reflect finance costs on the development loan for the first office tower as well as set-up and establishment costs, all which have been expensed upfront under IFRS,” said Centum.
The firm said the SEZ company is at an “advanced stage” of concluding the sale of the tower to a US dollar-denominated income Real Estate Investment Trust.
According to Centum, the sale of the tower will settle the development loan, recover set-up costs and eliminate finance costs and release capital for the development of the next tower.
