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Satchu's Rich Wrap-Up
 
 
Monday 23rd of October 2017
 
Morning
Africa

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Bitcoin breaches $6,000 for the first time @business
Africa


Home Thoughts


I have been reading a number of books but am enjoying

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Bwana Game
Africa


In Bwana Game George Adamson describes his childhood in India, his
family's move to Kenya and the strange and varied ways in which he
earned a living when he came out to Africa after leaving his English
school. These ran almost the whole gamut of available jobs and ranged
from ploughman, sisal plantation hand, barman, milk roundsman, to
trading in goats, beeswax and honey; entering Government Service as a
Locust Control Officer, making roads, becoming a professional hunter,
mica mining and finally, turned gold prospector, searching for the
Queen of Sheba's Mines. Among the many exciting safaris he made was an
expedition to Lake Rudolf, in the course of which he crossed its
dangerous waters in a boat which he and a friend built out of acacia
branches and groundsheets.

These fourteen years were mainly lonely ones in which George Adamson
developed a taste for freedom, a love of remote places, and a complete
disregard for danger and for security. At the age of 32 he had made
little money but had gained a unique knowledge of the land, people and
fauna of Kenya. It was then that he was offered a post in the Game
Department and found his vocation.

His account of his years spent as a Game Warden is crammed with
gripping stories of adventures with the grea~ter predators, and
delightful descriptions of the rescue of wounded or orphaned animals.
Twice he was seconded for other service during the Second World War,
and the Mau Mau troubles.

It was after the years spent with EIsa and her cubs that George
Adamson retired from the Game Service. He next worked on animal rescue
operations and then became technical adviser to the company which was
filming Born Free. His exceptional knowledge of lions, and the trust
he was always able to inspire in them, were invaluable in the training
of the animal cast. When the filming ended he devoted himself to
rehabilitating Boy, Girl and Ugas (lions which took part in the film)
to wild life. Some months later, four cubs were given to him and with
this pride he has settled in the bush where today he is caring for the
first and second generation of lions. Living day in, day out, most of
the time alone, with these magnificent animals has afforded him the
opportunity of noting every aspect of their lives and of observing
their markedly different characters; the descriptions he gives are
therefore of great zoological interest.

As well as being a thrilling autobiography of a man totally dedicated
to the preservation of wild life, Bwana Game contains unique
information concerning East African animals which have perhaps never
before been so intimately observed over many years.

read more




23-OCT-2017 :: Political risk. @TheStarKenya
Law & Politics


The carefully scripted and choreographed spectacle of the Chinese
Communist Party's Congress held every five years in Beijing's Great
Hall of The People stood in marked contrast to events all over the
World. The Communist Party proclaimed  “Life in China Is Good!
Everyday Is Like a Holiday!”  "The Chinese nation now stands tall and
firm in the east," Mr Xi pronounced in an echo
of the September 1949 declaration by Mao Zedong, that “the Chinese
people, comprising one quarter of humanity, have now stood up”.  In a
world that moves at a dizzying speed and can detour wildly off-course
with one Tweet from President Trump, Xi Jinping's China presents
itself as a country with a Plan and one that is moving inexorably
forward. Of course, China is brutal in stamping out any Noise that
might cause interference to this Signal.

In Europe, we are seeing Madrid [the Centre] trying to snuff out
Carles Puigdemont and Catalonia's surge towards seccession.
Decapitating the Catalonian Government is hardly going to prove a
clean Guillotine. Further afield in the Middle East, the Kurds [who
also recently held a Referendum] are seeing their dreams being snuffed
out. This Narrative of seccession also resonated here in Nairobi a
little with David Ndii casting himelf as a Kenyan Carles Puigdemont.
China's Xinjiang would vote for seccession to a Man and [Woman] but
China has turned Xinjiang into a Laboratory Experiment of State
Control.

Political Risk in Africa can be ''red in tooth and claw''  Somalia
with its newly minted Government has been an improving news story
until last week when the explosion of an enormous Car Bomb flashed
dystopian images of Mogadishu around the World. I saw a Photo of 2
sons carrying the charred embers of their Mother. President Farmajo is
all set to call for more War.

In South Africa, we saw the Rand tank to ten month lows as rumours
swirled that the Deputy President Cyril Ramaphosa was set to be
ejected. Standard Chartered shuttered the Gupta Accounts in 2014 and
that will be seen as a Badge of Honour unlike Mckinsey and KPMG and
others who followed the money even when it stank.

President John Pombe Joseph Magufuli of Tanzania presided over the
abject surrender of Barrick Chairman's John Thornton last week in a
ceremony that looked like something from the End of World War 11.
Tanzania's Barrick Gold [majority shareholder in Acacia mining] will
disgorge a 16 percent stake in three gold mines, a 50 percent share in
revenues from the mines and a one-off payment of $300 million to
resolve a dispute that has hit its operations in the country. I
completely accept that it is in Tanzania's national interest to chase
the highest absolute Pay-Out it can and as such President Magufuli is
standing Tall. The open question is this. Thornton's Barrick Resources
evidently had already made substantial investments in Tanzania and in
that sense we can characterise them as a ''sitting duck'' Barrick must
have had to make a calculation as to what would it cost to walk away
versus staying in.

Alike Dangote at a Financial Times Africa Conference said this about
Tanzania's mineral reforms to increase government equity: "They are
coming through the back door to seize your assets"

The Question for Tanzania is this? Is Tanzania still an investment
destination? Or will this prove a phyrric victory?

Of course, it would be remiss of me not to speak to our date with
destiny on October 26th. Interestingly, President Trump is set to
accede to the release of the The Final Documents On The JFK
Assassination on the same date. Jina Moore‏ tweeted ''So much for
anyone paying attention to the re-vote in Kenya on Oct 26 I guess''

Roselyn Akombe's [the erstwhile IEBC Commissioner] disembodied voice
came to us out of the Ether. The IEBC Chairman surfaced and did a near
perfect rendition of a rabbit caught in the headlights. The NASA
Leader announced all will be revealed the day before on October 25th.
We are in a very fluid moment. Will October 26th prove a political
Guillotine? Can the Opposition maintain this insurgent and asymmetric
response and degrade October 26th? We will discover the answers to
these questions soon enough.

read more





"The big question for me, really, is how Madrid is actually going to implement its proposed actions in Catalonia," said Caroline Gray
Law & Politics


“The big question for me, really, is how Madrid is actually going to
implement its proposed actions in Catalonia,” said Caroline Gray, a
lecturer in politics and Spanish at Aston University in the U.K. who
specializes in nationalist movements. “Catalan government officials
and many within the Mossos and Catalan media are not just going to
stand down without a fight.”

read more



Its de facto capital is falling. Its territory has shriveled from the size of Portugal to a handful of outposts. Its surviving leaders are on the run.
Law & Politics


But rather than declare the Islamic State and its virulent ideology
conquered, many Western and Arab counterterrorism officials are
bracing for a new, lethal incarnation of the jihadist group.

The organization has a proven track record as an insurgency able to
withstand major military onslaughts, while still recruiting adherents
around the world ready to kill in its name.

Islamic State leaders signaled more than a year ago that they had
drawn up contingency plans to revert to their roots as a guerrilla
force after the loss of their territory in Iraq and Syria. Nor does
the group need to govern cities to inspire so-called lone wolf
terrorist attacks abroad, a strategy it has already adopted to
devastating effect in Manchester, England, and Orlando, Fla.

“Islamic State is not finished,” said Aaron Y. Zelin, who studies
jihadist movements at The Washington Institute for Near East Policy.
“I.S. has a plan, and that is to wait out their enemies locally in
order to gain time to rebuild their networks while at the same time
provide inspiration to followers outside to keep fighting their
enemies farther away.’”

“It is clear that we are contending with an intense U.K. terrorist
threat from Islamist extremists,” Andrew Parker, the director of
Britain’s MI5 intelligence service, said in a speech on Tuesday. “That
threat is multidimensional, evolving rapidly, and operating at a scale
and pace we’ve not seen before.”

Gen. Joseph F. Dunford Jr., the chairman of the Joint Chiefs of Staff,
predicted last month that the loss of territory would precipitate a
loss of credibility. “We’ll continue to see reduction in territory,
reduction in freedom of movement, reduced resources and less
credibility in the narrative,” he told a Senate hearing.

Others are less sanguine. They point to a speech by the Islamic State
spokesman Abu Muhammed al-Adnani, before his death in an American
drone strike last year, urging the group’s followers to fight on as a
lean, agile insurgency instead of the bureaucratic juggernaut it had
become.

“True defeat is the loss of willpower and desire to fight,” he said.
“We would be defeated and you victorious only if you were able to
remove the Quran from the Muslims’ hearts.”

The group currently has from 6,000 to 10,000 fighters in Iraq and
Syria, the United States-led coalition said on Friday. That is eight
to 14 times the number it had in 2011.

“That’s the relevant comparison,” said Daniel L. Byman, a senior
fellow at the Brookings Institution’s Center for Middle East Policy,
who tracks jihadist groups. “This is a very strong group which has a
lot of sympathizers, its ideas are embedded and it has networks. It
has a lot to draw on even as it loses its physical territory.”

The group has also developed a powerful social media network that with
no physical presence allows it to spew propaganda, claim
responsibility for terrorist attacks, and not just inspire attacks but
also help plot and execute them remotely.

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"War on Korean Peninsula: Targeting a better peace" by @AlbertPalazzo via @LowyInstitute
Africa


The rhetoric emanating from Washington and Pyongyang may soon reach
the point at which a peaceful resolution is no longer be possible. A
year ago the chance of war on the Korean Peninsula would have been
considered remote. Now, the call for a US pre-emptive strike is
gaining support while North Korea routinely issues threats to the US,
South Korea and even Australia. With every passing day the possibility
of war seems to increase as Donald Trump and Kim Jong-un do their best
to set ablaze an already highly flammable situation. The tone between
the 'dotard' and the 'rocket man' has reached the point that one
miscalculation could trigger a war.

If war does occur there is little doubt that North Korea will be
defeated. While the North Korean army is massive in numbers it is
poorly equipped, most of its weapons are antiquated, and it lacks the
advanced technology essential for modern war. Its large submarine
fleet is out of date, and its air force is in even worse shape.
Compared to the military resources of South Korea, the North's are
decidedly second-best. If North Korea strikes, it will initially
inflict mass casualties on the South, both civilian and military.
However, once South Korea absorbs this blow its armed forces will
methodically take apart its enemy, with or without the US 2nd Infantry
Division's (or wider US) assistance. Tens of thousands of people will
die, but the regime of Kim Jong-un and his military will be destroyed.

read more





Big data meets Big Brother as China moves to rate its citizens @wired
Law & Politics


June 14, 2014, the State Council of China published an
ominous-sounding document called "Planning Outline for the
Construction of a Social Credit System". In the way of Chinese policy
documents, it was a lengthy and rather dry affair, but it contained a
radical idea. What if there was a national trust score that rated the
kind of citizen you were?

Imagine a world where many of your daily activities were constantly
monitored and evaluated: what you buy at the shops and online; where
you are at any given time; who your friends are and how you interact
with them; how many hours you spend watching content or playing video
games; and what bills and taxes you pay (or not). It's not hard to
picture, because most of that already happens, thanks to all those
data-collecting behemoths like Google, Facebook and Instagram or
health-tracking apps such as Fitbit. But now imagine a system where
all these behaviours are rated as either positive or negative and
distilled into a single number, according to rules set by the
government. That would create your Citizen Score and it would tell
everyone whether or not you were trustworthy. Plus, your rating would
be publicly ranked against that of the entire population and used to
determine your eligibility for a mortgage or a job, where your
children can go to school - or even just your chances of getting a
date.

A futuristic vision of Big Brother out of control? No, it's already
getting underway in China, where the government is developing the
Social Credit System (SCS) to rate the trustworthiness of its 1.3
billion citizens. The Chinese government is pitching the system as a
desirable way to measure and enhance "trust" nationwide and to build a
culture of "sincerity". As the policy states, "It will forge a public
opinion environment where keeping trust is glorious. It will
strengthen sincerity in government affairs, commercial sincerity,
social sincerity and the construction of judicial credibility."

Others are less sanguine about its wider purpose. "It is very
ambitious in both depth and scope, including scrutinising individual
behaviour and what books people are reading. It's Amazon's consumer
tracking with an Orwellian political twist," is how Johan Lagerkvist,
a Chinese internet specialist at the Swedish Institute of
International Affairs, described the social credit system. Rogier
Creemers, a post-doctoral scholar specialising in Chinese law and
governance at the Van Vollenhoven Institute at Leiden University, who
published a comprehensive translation of the plan, compared it to
"Yelp reviews with the nanny state watching over your shoulder".

For now, technically, participating in China's Citizen Scores is
voluntary. But by 2020 it will be mandatory. The behaviour of every
single citizen and legal person (which includes every company or other
entity)in China will be rated and ranked, whether they like it or not.

read more


Yen Hits Three-Month Low as Abe Win Secures BOJ Stimulus @business 113.81
International Trade


The yen fell to the lowest in more than three months after Prime
Minister Shinzo Abe’s ruling coalition secured an election victory
Sunday -- removing uncertainty over the country’s central bank policy.
The yen dropped 0.3 percent to 113.84 per dollar as of 7:39 a.m. in
Tokyo. The prime minister’s policy of Abenomics, composed of monetary
easing, a flexible fiscal policy and structural reforms to spur growth
has helped spur a more-than 20 percent decline in the yen since he
took office in December 2012.

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Currency Markets at a Glance WSJ
World Currencies


Euro 1.1755
Dollar Index 93.60
Japan Yen 113.81
Swiss Franc 0.9845
Pound 1.3191
Aussie 0.7821
India Rupee 65.025
South Korea Won 1130.77
Brazil Real 3.1929
Egypt Pound 17.6522
South Africa Rand 13.6944

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Arrested in Malawi After Mob Attacks on 'Vampires'
Africa


Lilongwe, Malawi (AP) -- Deadly mob attacks on people suspected to be
"vampires" have led to 140 arrests in Malawi, police said Friday.

The situation had spun out of control, the inspector general of
police, Lexon Kachama, told The Associated Press. More arrests were
expected.

Nine people have been killed in the attacks that began last month
after rumors of "blood-suckers" spread. In the latest case, a man with
epilepsy was burned to death in Blantyre, the southern African
nation's second-largest city, Kachama said. Another person there was
stoned to death.

President Peter Mutharika has appealed for calm in the four districts
where the mob attacks have taken place, saying this week that "my
government will offer protection from these alleged blood-suckers."

The United Nations and U.S. Embassy have blacklisted some of the areas
as dangerous zones for staffers.

"The biggest challenge is that thieves and robbers have now taken
advantage of the situation and are mounting illegal roadblocks at
night in order to harass people," Kachama said.

Government officials have said the attacks were harming the deeply
impoverished country's image. Residents including health officials,
teachers and traditional leaders have said their homes were destroyed
after rumors spread that they were harboring "vampires."

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Barrick to Give Tanzania Mines Stake, $300 Million to End Dispute
Africa


DAR ES SALAAM — Barrick Gold will give Tanzania a 16 percent stake in
three gold mines, a 50 percent share in revenues from the mines and a
one-off payment of $300 million (£227.6 million) to resolve a dispute
that has hit its operations in the country, the two sides said.

The Canadian miner and Tanzanian government have been in talks for
months after the east African country banned the export of unprocessed
minerals and enacted new laws to raise state ownership of the nation's
mines.

Tanzania is Africa’s fourth-largest gold producer, and Barrick's
Acacia Mining Plc is its largest miner, with three gold mines that
also produce copper.

At 1200 GMT, Acacia's London-listed shares were up 18 percent
following news of the deal.

Barrick Chairman John Thornton told a news conference in the Tanzanian
capital the deal would have to be approved by the independent
shareholders and directors of Acacia Mining.

Tanzanian justice and constitutional affairs minister Palamagamba
Kabudi said the agreement was in keeping with the new mining laws
passed in July.

"We have also agreed to have a 50:50 share of revenues between the
government and Acacia Mining from all the mines," he added.

read more


Barrick Strikes $300 Million Deal With Tanzania in Acacia Fight
Africa


It took a day, but Barrick Gold Corp.’s tentative deal with Tanzania’s
government to end a tax dispute at its African subsidiary is becoming
clearer.

In a press conference and two statements, the world’s largest gold
producer revealed that Acacia Mining Plc would pay Tanzania’s
government $300 million and divide the future “economic benefits” of
its mining operations in the African nation.

The proposed payment is a “a show of good faith,” Barrick Executive
Chairman John Thornton said Thursday at a briefing after a six-hour
meeting with President John Magufuli in the commercial capital, Dar es
Salaam.

“A partnership requires trust between the two parties,” Thornton said.
“I wouldn’t be standing here today if we didn’t feel that there was
good trust established between the two parties as a result of our
three months of discussions.”

In a subsequent statement, Toronto-based Barrick clarified that its
subsidiary would make the $300 million payment and reiterated it
agreed with the government to establish a working group that will seek
to resolve outstanding issues on the tax claims, including the terms
of the payment.

50/50

As part of the proposed deal, a new Tanzanian operating company will
be created to manage Acacia’s three main mines, and the government
“will participate in decisions” related to its operations, investment,
planning, procurement and marketing, Barrick said in a second
statement. The economic benefits would be split on a 50/50 basis
between the new company and Tanzania, and the government’s share will
be “delivered in the form of royalties, taxes, and a 16 percent free
carry interest in the Tanzanian operations,” Barrick said.

Magufuli in July slapped a $190 billion tax bill on Acacia Mining,
which is 64 percent owned by Barrick, claiming the company
under-declared export revenue from its mines from 2000 to 2017. Acacia
stopped underground production at its Bulyanhulu mine in September
until the dispute is resolved, and said output would drop as much as
17 percent this year as a result.

Acacia rose as much as 41 percent in London, the biggest intraday gain
since its initial public offering in March 2010, and ended the session
up 16 percent. Barrick fell 0.2 percent in Toronto.

All of the proposals are subject to review and approval by Acacia’s
board and shareholders, Barrick said.

State Supervision

Acacia said in its own statement it had yet to sign off on the plan.
“Acacia has just received a copy of the framework agreement referred
to in Barrick’s release and is seeking further clarification,” it
said.

Justice and Constitutional Affairs Minister Palamagamba Kabudi said
the two sides also agreed:

The state will have representatives on the board of the company and at
every mine.
The company will hire local full-time staff.
Acacia will have the headquarters for its operations in Mwanza, Tanzania.
Acacia will keep all cash generated by mines in Tanzania in accounts
within the country.
The funds that Acacia pays will be used to fund infrastructure
projects in Tanzania, Magufuli said at the briefing. Magufuli is
overhauling the country’s natural-resources industry to try to ensure
the government gets a greater share of revenue from its raw materials
and help finance his plan to industrialize sub-Saharan Africa’s
sixth-biggest economy. The country plans transport and utilities
projects worth at least $19 billion, according to
PricewaterhouseCoopers LLP.

“This new structure that Barrick has recommended, a system for the
21st century, of a 50-50 partnership, is a huge shift in the
regulation of natural resources, not only on the African continent,
but the world,” Magufuli said. “This shows the intent of the Tanzanian
government, but also the intent of Barrick: that now we open a new
chapter that will enable Tanzanians to see the benefits of their
mines.”

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"... The first comment I would make is that Barrick is equally aware of our balance sheet as we are," said Acacia's chief financial officer, Andrew Wray
Africa


“... The first comment I would make is that Barrick is equally aware
of our balance sheet as we are,” said Acacia’s chief financial
officer, Andrew Wray, on a call with analysts.

“We don’t have the ability to make an upfront $300 million payment,”
he said, adding that a Barrick and government working group would need
to come up with a solution.

Acacia shares traded in London tumbled 7 percent to 198 pence by 1218
GMT, partly erasing a 16 percent gain on Thursday after the agreement
was announced. The shares have fallen over 60 percent since the
disputes broke out.

read more



Millennials' search for experiences over luxury is driving Airbnb's growth in Africa
Africa


In the last five years, more than 2 million people have found holiday
accommodation in Africa through Airbnb which now has over 100,000
listings on the continent.African hosts earned $139 million in the
last year, according to a new Airbnb study.

By opening up the homes of Africans to visitors, Airbnb has also
opened up a previously untapped market. Travel in African is known to
be expensive, and along with pricey flights, luxury hotels and
five-star safari lodges used to be among the few choices tourists to
the continent had. With Airbnb, tourists can live, eat and experience
life as a local, appealing to the millennials driving the
experience-over-stuff economy. What’s more, it’s opened up tourism not
only to international visitors, but curious young Africans, too.

read more


"That is not the South Africa of our dreams" South African Deputy President Cyril Ramaphosa
Africa


South African Deputy President Cyril Ramaphosa said mounting
allegations that the state has been “captured” by private business
interests is damaging the nation’s international reputation, as rumors
swirled that he’s about to be fired amid a battle for control of the
ruling party.

“Our state, comrades, is now being talked about in the most negative
terms all over the world,” Ramaphosa said Friday in a speech to
members of the National Education, Health and Allied Workers’ Union in
Cape Town. “When they look at South Africa today, they are looking at
a country that they say has been captured by certain interests, by
certain families, by certain individuals. That is not the South Africa
of our dreams.”

read more



South Africa All Share Bloomberg +14.40% 2017
Africa


Dollar versus Rand 6 Month Chart INO 13.6944

http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&v=d6&t=c&a=50&w=1

#SouthAfrica's #rand is being hammered this week. Today's loss is
down to speculation #Zuma will fire #Ramaphosa @PaulWallace123

https://twitter.com/PaulWallace123/status/92132585532184576

Egypt Pound versus The Dollar 3 Month Chart INO 17.6522

http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&v=d3&t=c&a=50&w=1

Nigeria All Share Bloomberg +36.14% 2017

http://www.bloomberg.com/quote/NGSEINDX:IND

Ghana Stock Exchange Composite Index Bloomberg +37.05% 2017

http://www.bloomberg.com/quote/GGSECI:IND

read more



Political turmoil threatens re-run of Kenyan presidential vote FT
Kenyan Economy


Joshua Onyango says he is willing to die in protests to demand reform
of Kenya’s electoral commission ahead of Thursday’s repeat
presidential election. If there is no change, he vows to stop the
vote.

“We will not relent, even if the police kill us all,” says Mr Onyango,
a truck driver from Kisumu, a stronghold of Raila Odinga, the veteran
opposition leader. “We can’t have a corrupt referee to oversee the
rematch after a bungled election.”

Mr Onyango is referring to the Independent Electoral and Boundaries
Commission (IEBC), whose mis-handling of an August 8 vote was the
reason given by the supreme court for nullifying the victory of
President Uhuru Kenyatta. Citing “irregularities” and “illegalities”
it ordered this week’s re-run after Mr Odinga challenged the resu

“The IEBC is ready to conduct an election on 26th but the country is
not ready politically,” one western diplomat said.

Neither Mr Kenyatta or Mr Odinga appear ready to compromise even as
the crisis deepens. The president has been dismissive of his rival’s
decision to withdraw from the contest, describing it as a “stunt by a
man who knows he cannot win”.

Mr Odinga has said he will only “reconsider” if his demands for
wholesale reform of the election commission are met. The opposition is
promising the “mother of all protests” on polling day, and Odinga
supporters last week attacked training sessions being run by the
commission for polling staff.

Mr Odinga’s supporters insist their actions are necessary to prevent
the election being rigged in a country with a history of disputed
votes.

“Business has never been this bad, not even in the Moi years,” says
the chief executive of one of the country’s biggest banks, referring
to Daniel arap Moi, the autocrat who ruled for 24 years.

read more



Kenya Power & Lighting Company Ltd. reports FY 17 EPS +0.813% Earnings here
Kenyan Economy


Par Value:                  20/-
Closing Price:           9.55
Total Shares Issued:          1951467045.00
Market Capitalization:        18,636,510,280
EPS:             3.72
PE:               2.56

The energy company in charge of national transmission, distribution
and retail of electricity throughout Kenya.

FY Non-fuel revenue 91.952b vs. 87.081b +5.594%
FY FX Adjustment 6.682b vs. 8.782b -23.913%
FY Fuel cost recharge 22.108b vs. 12.512b +76.694%
FY Revenue 120.742b vs. 108.375b +11.411%
FY Non-fuel costs [50.616b] vs. [51.400b] -1.525%
FY FX Costs [6.199b] vs. [6.175b] +0.389%
FY Fuel costs [22.124b] vs. [12.690b] +74.342%
FY Total power purchases costs [78.939b] vs. [70.265b] +12.345%
FY Gross margin 41.803b vs. 38.110b +9.690%
FY Other operating income 8.130b vs. 7.470b +8.835%
FY Transmission and distribution costs [33.416b] vs. [28.651b] +16.631%
FY Operating profit 16.517b vs. 16.929b -2.434%
FY PBT 10.912b vs. 12.083b -9.691%
FY PAT 7.266b vs. 7.197b +0.959%
Basic and diluted EPS 3.72 vs. 3.69 +0.813%
Dividend per share 0.50 vs. 0.50 –
Total Assets 341.653b vs. 297.542b +14.825%
Cash and cash equivalents at close of year [1.150b] vs. 5.503b -120.898%

Company Commentary


During the year under review, the net profit before tax decreased by
9.7% to Shs. 10,912 million from Shs. 12,083 million in the previous
year. This was mainly attributable to increased transmission and
distribution costs as a result of maintenance activities on the
expanded network.
Electricity sales grew by 4.5% from 7,912 million units the previous
year, to 8,272 million units in the period under review. This,
combined with an improved average yield, led to 5.6% increase in sales
revenue, from Shs. 87,081 million the previous year to Shs. 91,952
million.
Power purchase costs, excluding fuel and foreign exchange costs,
decreased by Shs 784 million from Shs 51,400 million the previous
year, to KShs.50,616 million. This is attributable to a reduction in
units purchased from the hydro generation due to poor hydrology in the
year and reduced geothermal generation in the year. The units
purchased from hydro power sources and geothermal reduced by 13.2
percent from 3,787 GWh to 3,341 GWh and 3.4 percent from 4,608 GWh to
4,451 GWh, respectively.
Fuel cost increased by Shs 9,434 million from Shs 12,690 million the
previous year to Shs 22,124 million due to increased usage of thermal
sources during the year. Electricity units generated from thermal
plants increased by 66.9 percent, from 1,297 GWh the previous year to
2,165 GWh.
Transmission and distribution costs increased by 16.6 percent from Shs
28,651 to Shs 33,417 million in the year. The rise was attributed to
higher operational and maintenance costs on the expanded electricity
network facilities, depreciation due to increased capital investment
and the rising cost of doing business.

Conclusions


The Price Earnings ratio is less than 3.
The issue is the lack of share price performance.

read more



Nairobi All Share Bloomberg +16.19% 2017
Kenyan Economy


NSE All Share
August 28th        173.47 (2017 High)
October 19th      154.93
-10.688%

read more


Nairobi ^NSE20 Bloomberg +11.23% 2017
Kenyan Economy


NSE 20 Share
August 15th        4,114.01 (2017 High)
October 19th      3,543.99
-13.856%

read more




 
 
N.S.E Today


Prime Minister Shinzo Abe of Japan won a Two-Thirds 'Supermajority' in
the snap Election and can expunge the pacifist component in the
Japanese constitution.
The Nikkei 225 Index bagged a record 15th straight day of gains.
The Dollar is making upwards progress after a torrid Trump ''apocalypse'' Year.
The Euro lost ground as the markets consider Rajoy's response to
Carlos Puidgemont's dash for secession in Catalonia.
The Financial Times concluded an Article about Kenya with the following
“Business has never been this bad, not even in the Moi years,” says
the chief executive of one of the country’s biggest banks, referring
to Daniel arap Moi.
The Kenya Shilling slipped to 103.70 versus the Dollar. We touched 104
momentarily earlier in the Year.
The Nairobi All Share after retreating -10.688% since August 28th
[2017 closing High] finally rebounded and closed 0.735% at 156.07 and
on robust volume action worth 1.176b.
The Nairobi NSE20 Index could not snap its losing streak which had
seen the NSE20 retreat -13.856% since August 15th [2017 closing High]
and edged 2.44 points lower to close at 3541.46.



N.S.E Equities - Commercial & Services


Safaricom firmed +1.04% to close at 24.25 and was trading session
highs of 24.75 +3.13% at the Finale. Todays constructive price action
was delivered on the back of some good sized volume action with
23.406m shares worth 567.694m traded and the highest volume traded for
more than 6 weeks. Safaricom's price has corrected -6.73% lower since
August 28th outperforming the Nairobi All Share which has retreated
-10.688% over the same dates. There is plenty to get excited about
around Safaricom and I look for a meaningful rally towards 32.00
before Year End.

Kenya Airways
rallied +2.08% to close at 4.90 an 8 week high and
traded 1.117m shares.



N.S.E Equities - Finance & Investment


Jubilee Insurance improved +1.87% to close at a 5 month high of 490.00
and on unusually high volume action of 337,100 shares [0.465% of its
shares] worth 165.346m. Jubilee reported a +23.168% acceleration in H1
2017 EPS and is +1.734% on a Total Return Basis this year and has room
to probe levels of 500.00+

KCB c
losed +0.68% better at 36.75 and traded 3.975m shares.
Equity Bank closed unchanged at 36.25 and traded 2.667m shares.
Standard Chartered was upticked +4.62% to close at 223.00 on 300
shares. The Supply is exhausted at these levels.



N.S.E Equities - Industrial & Allied


KPLC reported FY Earnings where FY Revenue clocked a +11.411% increase
to reach 120.742b, FY Profit before Tax slid -9.691% to 10.912b, FY
PAT eked out a +0.959% gain, Earnings Per Share was 3.72 and the FY
Dividend was maintained at 50cents a share. KPLC cited '' increased
transmission and distribution costs as a result of maintenance
activities on the expanded network'' as crimping Earnings. The Price
Earnings Ratio is less than 3 which is egregious but Investors need to
be aware that this has been the situation for a while. At some point
we will have a Price Trigger and a PE of 6 [which would double the
share price] is a little less egregious and possible but will require
Management to make the case for the share price, something they have
been loathe to do. KPLC firmed +0.52% to close at 9.60 and was trading
at a session high of 9.80 +2.62% at the Finish. KPLC's dividend is
worth 5.1% of yield and some Investors will be keen on snaffling that
up.

KenGen rebounded +2.48% to close  at 8.25 and traded 339,500 shares.
KenGen served up a +34.02% FY 17 EPS gain and last weeks profit taking
was a knee-jerk reaction to the dividend pass. I expect that to be
reversed and ave a price target of 10.00.

EABL rallied +1.666% to close at 244.00 and traded 681,800 shares
worth 166.995m. EABL trades on a Trailing PE of 25.00.

ARM rebounded +4.924% to close at 13.90. ARM remains -45.49% in 2017.

--



by Aly Khan Satchu (www.rich.co.ke)
 
 
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October 2017
 
 
 
 
 
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