Financial services firm UAP Holdings extended its losses to Ksh.3.4 billion for the year ending December 31 from a Ksh.518 million loss in 2018.
The firm on Wednesday said it recorded a loss before tax of KSh 3,229 million in 2019 compared to a loss before tax of KSh 480 million in the previous year.
The decline was mainly driven by one-off fair value write-downs on the Group’s investment property portfolio due to the softening of the markets in Kenya and Uganda Uganda and prevailing operating environment challenges in South Sudan.
As a result, the firm’s value of property investments declines sharply to Ksh16 billion from Ksh19.8 billion a year earlier.
“There are indicators that the weakening performance of the property market in Kenya and the uncertain political environment in South Sudan will likely lead to further impairments in the carrying value of certain investment properties,” UAP board said.
General Insurance Business reported a profit before tax of Sh2.33 billion representing a 133 percent improvement over 2018.
Life Insurance Business reported a profit before tax of KSh392 million, an improvement of 113 percent over 2018.
However, the properties business reported a loss before tax of KSh4.88 billion, representing a decline of 268 percent.
UAP Holdings’ Chief Executive Officer Arthur Oginga expressed optimism in the recovery of the portfolio supported largely by improving market conditions.
“We believe we have hit the bottom end of the market and are optimistic the market in South Sudan will turn supported by easing tensions. Further, we expect stronger rental yields to support growth with half of our building already consisting of fairly new units with longer leases,” he said.
The board did not declare any dividend for the second year running as the company’s earnings per share dipped further to a negative Ksh14.23 from negative Ksh1.66.