Nakumatt receives KES1.4 billion for expansion
12 April 2013, 12:34
Nairobi - East Africa’s largest retail chain, Nakumatt Supermarkets, will spend KES 1.4 billion (US$17.8 million) this year to fund the opening of outlets in Uganda and Kenya.
Nakumatt managing director, Atul Shah, said the retailer would set up four branches in Uganda and one in Kenya in a move aimed at shopping for opportunities in Burundi and South Sudan, which would give the retail chain a presence in all East African countries.
“In terms of roll out in Uganda, we are already fitting out the proposed Nakumatt Katwe branch, which we hope to open by early June. Construction at the Village Mall in Bugolobi is also at an advanced stage.
“Kisementi and Entebbe branches at Acacia and Victoria Malls will also be ready for opening in the fourth quarter of this year,” Shah said.
Uganda has been among the more successful operations for Nakumatt outside Kenya, which Shah attributed to the availability of ideal retail locations.
Over the next four years, the firm expects to use more than KES 4 billion (US$47.5 million) to expand outside the East African Region (EAR).
Shah said Nakumatt Supermarkets were expected to open its first retail store outside East Africa in 2015.
Shah added that the firm was still evaluating financing options.
He said Nakumatt Supermarkets had planned to bring a partner on board three years ago, but shelved the idea after obtaining financing from local banks as well as support from its suppliers.
Shah said the company was still open to getting a partner that would bring in more than just finances, but only after it consolidated its regional position.
He added that Nakumatt has received proposals from investors in Nigeria, Botswana, and Zambia.
Nakumatt Supermarkets run more than 50 outlets in the East African Region.
Meanwhile, as oil marketer Kenolkobil’s shares resume trading at the Nairobi Securities Exchange on Friday, all eyes will be cast on how investors and shareholders digest news of the largest loss ever reported by a listed company.
The oil marketer reported a KES 6.3 billion (US$72.2 million) after-tax loss for its full year results ended December 31.
KenolKobil’s CEO and Chairman of the board, Jacob Segman, said the loss was occasioned by lower sales, foreign exchange losses and higher operating expenses, compared to the previous year.
Turnover fell 13 per cent to KES 192 billion and the company’s gross margins – the difference between sales revenues and cost of goods – were hurt “by a drop in international oil prices, coupled by the downward price adjustments by regulators in the various markets”.
The results were released after the close of trading at the NSE on Monday, with the KenolKobil shares down 1.4 per cent to trade at KES 10.45.
“There is no telling where the share price will go,” said Eric Kimanthi, an analyst at Standard Investment Bank.
- CAJ News