Car & General Kenya (C&G) made a profit before tax of Kshs 105 million in the first six months of 2024, a drop from Ksh 126 million posted in the same period in 2023.
C&G’s turnover for the period ending June this year grew by 3.7% to Kshs 11 billion. The company said that “the performance was significantly affected by the 8.7% drop in sales at in Kenya.
The company’s trading operations in Kenya saw a reduction in the market for motorcycles since 2022. Currently, the company sells 4,000 motorcycles per month compared to monthly sales of 20,000 units two years ago.
“Motorcycle purchases continue to be affected by lower consumer purchasing power which has reduced the daily utilization of ‘boda boda ‘and consequently the daily unit profitability (especially given higher fuel costs) has deteriorated leading to lower levels of overall demand,” the official statement by company read.
“The expect motorcycle demand in Kenya to remain subdued for the foreseeable future,” the statement added.
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Car & General deals with a wide product rnage including automotive, power generation, industrial and construction products. In recent years, the company has expanded its operation to regional markets.
The company’s trade operations in Uganda and Tanzania grew by 45% and 13.3%, respectively. Its poultry operation in the neighbouring country Tanzania stabilized and reported positive progress. C&G’s investment in electrical vehicles received a positive responses.
Watu, one of the C&G’s associate reported a drop in profits due to losses in DRC, Nigeria and Sierra Leone. The firm said it expects the challenging economic conditions to persist in terms of forex, inflation and constrained liquidity.
Despite the profit, C&G’s directors did not declare an interim dividend.
(Exchange Rate: 1 USD = 129)
