Total Kenya, the country's largest oil marketer by share, reported yesterday net earnings for six months through June rose 36.63 per cent, helped by effective cost-cutting measures.
Total's profit reached Sh717.90 million from Sh525.45 million it posted in the same period of 2015, even after revenues from sales dropped by Sh15.23 billion to stand at Sh48.87 billion.
The earnings trailed behind those of KenolKobil which made Sh1.19 billion profit, a 29.54 per cent growth year-on-year.
Second largest marketer Vivo Energy, trading as Shell, does not make public its performance because it is privately-held.
Total Kenya, controlled about 94 per cent by France's Total Group, cut direct costs by Sh16.73 billion or 31.81 per cent to Sh35.36 billion.
“This good performance is attributed to the efforts and action plans set by the management and the board of directors,” managing director Anne-Solange Renouard said in a statement. “Operating expenses were contained and in line with management expectations.”
The firm which controlled 18.5 per cent market share as at March would have made more profit were it not for taxes. Total's dues to the taxman more than doubled, rising 130.95 per cent to Sh845.90 million.
“The tax charge...included a provision arising from an audit tax assessment by the Revenue Authority relating to prior years,” Renouard said.
Fuel prices in the country are controlled following the enforcement of the Energy (Petroleum Pricing) Regulations in December 2010. Regulator, the Energy Regulatory Commission, sets maximum retail prices on 15th of every month.
Oil marketers are allowed Sh11 wholesale profit margin per litre in the fuel pricing formula, with Sh4 to cover for distribution costs.