LIBERTY Kenya holdings limited has become the 18th publicly listed company to issue a profit warning, highlighting a tough operating environment for businesses in 2015.
The listed insurer and wealth management firm said on Friday its earnings for the year ended December 31, are expected to be at least 25 per cent lower than 2014.
The operator of Liberty Life Assurance and Heritage Insurance Company said it expects lower profits due to general decline in the values of market-to-market financial instruments (listed equities and fixed income securities), hit by the bear run on Nairobi Securities Exchange last year.
The company which is ranked eighth among insurance providers in the country by market share, posted a Sh1.15 billion profit after tax for the year 2014, up from Sh1.1 billion in 2013.
“There was a decline in asset values which negatively impacted the investment income when compared to the previous year,” the company said in a public notice signed by chairperson Susan Mboya-Kidero and managing director Mike du Toit.
Standard Chartered Bank, Mumias Sugar, Uchumi Supermarkets, Standard Group and TPS Eastern Africa are some of the companies whose profit is expected to fall by more than 25 per cent in 2015 compared to 2014.
Others are Britam Holdings, ARM Cement, East African Cables, BOC Gases, Car & General, Sameer Africa, Crown Berger, Express Kenya and Atlas Development.
UAP Insurance, which trades over-the-counter, has also issued an alert over lower year-on-year profit.
Last year was challenging for the NSE whose returns fell by 20.97 per cent, as measured by the more reflective NSE 20-Share Index that closed at 4,040.75 points from 5,112.65 a year before.
Only 13 out of 65 companies listed on the NSE posted gains on their stock prices during the difficult year, when the shilling weakened by 12.92 per cent to 102.31 units against the US dollar from 90.60 a year earlier.
The paper value of investor wealth, as measured by market capitalisation, dropped by Sh250 billion or 10.87 per cent to Sh2.05 trillion on December 31 from Sh2.30 trillion a year before, the end-year statistics by the NSE indicates.