Table of Contents
Key Points
- BOC’s profit jumps 22.6 percent to Sh61.7 million, thanks to effective cost-cutting even as revenue drops.
- Smart cost control keeps BOC’s profits growing, despite an 11 percent revenue dip in early 2024.
- BOC expects more profit growth ahead with new projects and price adjustments in the second half of 2024.”
BOC, led by Kenyan executive Gathoga Mwangi, saw its net profit jump by 22.6 percent in the first half of 2024, reaching Sh61.7 million ($478,185), up from Sh50.3 million ($389,833) last year.
This impressive growth happened despite a dip in revenue thanks to smart cost-cutting measures that kept the company in good financial health.
Smart cost management despite revenue drop
BOC successfully cut its operating costs to Sh165.7 million ($1.3 million), down from Sh194.2 million ($1.5 million) the previous year.
These strategic cost controls helped the company stay profitable even though revenue fell by 11 percent, from Sh589.9 million ($4.6 million) to Sh523.4 million ($4.1 million). The revenue drop was mainly due to the end of several donor-funded projects that had previously boosted BOC’s sales.
To navigate these challenges, BOC adjusted its pricing strategy. As some tenders expired in 2024, the company was able to raise prices, which helped offset the impact of a steep 60 percent hike in electricity tariffs earlier in the year. This strategic move allowed BOC to manage rising energy costs and protect its profit margins.
Positive outlook for the rest of 2024
Looking forward, BOC expects to continue growing its profits in the second half of the year.
The company anticipates higher demand for medical gases, thanks to infrastructure projects completed last year. BOC also plans to capitalize on price adjustments for expiring tenders and a recent 5 percent reduction in electricity tariffs.
Reflecting its strong performance, BOC’s Board of Directors has announced an interim dividend of Sh2.50 per share. This is a great progress, as no dividend was declared in the same period last year.
The dividend will be paid around Oct. 14, 2024, to shareholders on record by September 20.
