Real estate firm Home Afrika Limited has posted a rare Sh133.4 million net profit for the year ended December 2024 –the first year of profitability for the company since 2014. The company had made a net loss of Sh27.8 million in 2023.
The latest performance represents the third time the developer has churned a profit since going public in 2013.
The return to profitability for the Nairobi Securities Exchange (NSE) firm is largely attributable to a higher turnover as revenue from contracts with customers jumped by two-fold to Sh781.9 million from Sh377.1 million previously.
“The turnaround saw a number of leases registered from the Migaa project, strategic recognition of deferred income from completed projects and the continuous issuance of titles from the smart plots projects,” Home Afrika said in a trading statement on Friday.
Home Afrika also noted it had diversified its income streams following the completion of the 18-hole golf course in Kiambu, which received a rating from the Kenya Gold Union (KGU) resulting in a significant increase in the number of tournaments and golfers paying user fees.
The firm, however, saw its administrative expenses swell to Sh136.5 million from Sh80.2 million after increasing its marketing and promotional activities.
The company meanwhile took a lower tax charge at Sh11.6 million, a moderate growth from Sh5.5 million previously despite pretax profit rising to Sh145 million from a pretax loss of Sh22.2 million. Home Afrika’s costs of sales also grew slower than revenues at 55.6 percent, hitting Sh408.4 million from Sh262.3 million previously.
The company says its 2024 result is a culmination of its four-year strategy to turnaround its performance from a decade-long run of loss-making.
“In 2024, Home Afrika Limited experienced a resilient turnaround amidst Kenya’s evolving real estate landscape in a year marked by economic headwinds and sectoral shifts,” Home Afrika added.
“The company emerged with a compelling turnaround story, underscoring resilience, strategic foresight and adaptability.”
The company is betting to grow on its success from last year, including leveraging market trends such as capitalizing on the growing demand for luxury and mixed-use developments.
The management of the company says it is confident of acquiring new projects to generate revenue while it also plans to hand over completed projects to individual investors and management companies.
The directors of Home Afrika have not recommended a dividend for the period as the company works to move itself into a positive equity position.
Home Afrika ended December 2024 at a negative equity position of Sh2.3 billion, a slight improvement from a deficit of Sh2.5 billion in 2023.
“The board remains confident in Home Afrika’s long-term strategy to return to profitability and create value for investors,” the company added.
