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    EQTY   KE0000000554


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Equity : U.S.$163 Million - Equity Hits 99 Percent in Half Year Profits

08/18/2021 | 04:06am EDT

Growth in profit after tax of 98% ($163.5 million)

Total Assets growth of 50%

Growth in Deposits of 51% ($7.4 billion)

Growth in Net Loans of 29% ($4.6billion)

Nairobi, Kenya | THE INDEPENDENT | Equity Group Holdings Plc has announced a 98% growth in half year profits to $163.5 million (Kshs.17.9 billion) up from $83.1million (Kshs.9.1) billion the previous year.

Speaking while releasing the results, Equity Group Managing Director and CEO Dr James Mwangi said, "The defensive and offensive strategy adopted by the Group at the onset of the Covid-19 pandemic to create resilience, agility and recovery has been very effective in positioning, navigating and driving performance."

The offensive growth strategy saw deposits register a 51% growth to $7.4 billion (Kshs.820.3 billion) up from $4.9 billion (Kshs 543.9 billion), while long term borrowed funds grew by 78% to Kshs. 102.3 billion up from Kshs.57.6 billion.

Net Loans and advances grew by 29% to $4.6billion (Kshs.504.8 billion) up from Kshs.391.6 billion, while investment in Government securities grew by 46% to Kshs.315.5 billion up from Kshs.216.4 billion resulting in 50% growth in Total Assets to Kshs.1.12 trillion up from Kshs.746.5 billion.

The aggressive growth strategy effected by the Group resulted into a 33% growth in topline Total Income to Kshs.51.6 billion up from Kshs. 38.7 billon driven by a 26% growth in Net Interest Income of Kshs. 31.2 billion up from Kshs.24.6 billion and a 45% growth in Non-Funded Income of fees, commission and transactions to Kshs.20.4 billion up from Kshs.14.1 billion.

The defensive approach focused on high asset quality, strong capital and liquidity buffers that saw the Group present a strong non-performing loans (NPL) coverage of 92% up from 73% the previous year attributed to a decline in gross non-performing loans by Kshs.1.3 billion from Kshs.61.2 billion to Kshs.59.9 billion. Loan loss provision declined by 66% from Kshs.7.7 billion to Kshs.2.6 billion to register cost of risk of 1.2% down from 4.2%.

Net non- performing loans declined by Kshs. 5.4 billion from Kshs.28.3 billion to Kshs.22.9 billion due to the aggressive provisioning the previous year under the defensive strategy. Of the Kshs. 171 billion Covid-19 restructured loan book, Kshs. 162 billion is categorized as performing with Kshs. 103 billion having resumed repayments, Kshs. 6 billion fully repaid, Kshs. 92 billion up to date in repayment and Kshs. 5 billion non performing. Only Kshs 64 billion remains under Covid-19 moratorium constituting only 11% of the entire loan book. Total operating costs grew by 4% to Kshs.27.8 billion against a 33% growth in total income to Kshs.51.6 billion driving profit before tax up to Kshs.23.8 billion up from Kshs.12 billion a growth of 99%.

Efficiency gains saw Cost Income Ratio decline marginally to 48.5% from 48.8% driven by a reduction of cost of funds to 2.6% down from 2.9%.

Total capital to risk weighted assets stood at 17.6% while core capital to risk weighted Assets stood at 14.1% as at 30th June positioning the business ready for accelerated growth.

"The strong capital and liquidity ratios have positioned the Group well for continued execution of the offensive strategy particularly in light of improving asset quality and operational efficiency and an improving operating environment," added Dr. Mwangi.

The 6 countries within which the Group operates have projected strong GDP growth rates; Kenya 7.6%, Uganda 6.3%, Rwanda 5.7%, South Sudan 5.3%, DRC 3.8% and Tanzania 2.7% (IMF 2021 projections) with fairly stable Micro Economic Environment, making the Group well positioned to continue with its offensive and defensive strategy for resilience, agility, recovery and rapid growth.

The regional approach with Kenya now being only 60% of the Group balance sheet mitigates national shocks and sovereign risks. Group efficiencies shared with the subsidiaries are quickly translating regional growth to value creative growth, with majority of the regional subsidiaries Return on Average Equity being higher than their cost of capital.

Copyright The Independent. Distributed by AllAfrica Global Media (allAfrica.com)., source News Service English

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Sales 2021 109 B 982 M 982 M
Net income 2021 33 179 M 299 M 299 M
Net Debt 2021 - - -
P/E ratio 2021 5,74x
Yield 2021 6,13%
Capitalization 188 B 1 694 M 1 697 M
Capi. / Sales 2021 1,73x
Capi. / Sales 2022 1,44x
Nbr of Employees 7 119
Free-Float 77,4%
Duration : Period :
Equity Group Holdings Plc Technical Analysis Chart | MarketScreener
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Technical analysis trends EQUITY GROUP HOLDINGS PLC
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 10
Last Close Price 49,90 KES
Average target price 52,44 KES
Spread / Average Target 5,08%
EPS Revisions
Managers and Directors
James Njuguna Mwangi Group CEO & Non-Independent Executive Director
David Ngata Group Director-Finance
Isaac Muthure Macharia Non-Executive Chairman
Lanre Bamisebi Group Chief Information Officer
Evelyn Kamagaju Rutagwenda Independent Non-Executive Director