Cytonn Investments has released their 2016 audited financial year results witnessing a growth in total assets by 77 percent from 6.7 billion shillings recorded in 2015 to 11.8 billion shillings in 2016.
According to the management, while releasing the results, the growth in total assets was driven by an increase of 80.1 percent in investment property from 5.6 billion shillings as in 2015 to 10.1 billion shillings at the end of 2016 while the projects under mandate in the real estate portfolio increased by 85 percent from 40 billion shillings in 2015 to 74 billion shillings at the end of 2016.
“Our strategy in 2016 was to grow our firm across the four key pillars of people, products, processes and distribution, to position ourselves to consistently deliver on the attractive alternative investment opportunities, which exist in Kenya and the region,” said Edwin H. Dande, Cytonn’s Chief Executive Officer.
“We are the only brand that has coupled up real estate finance and real estate development onto one platform, it’s a niche with almost no competitor. Consequently, the firm made heavy investments in growing, retaining and hiring the very best talent, resulting in staff numbers increasing over threefold to 250 people – the best time to hire is when markets are slow and market players are laying off. In terms of product, we invested heavily in our real estate development pipeline, growing 300 percent from 3 live projects to 12 live projects. Distribution was a key area of investment for the firm, as we look to expand across Kenya and the region. We now have three offices in Nairobi, 1 in Washington D.C. Metro, 109 independent financial advisors and agents and over 100 financial advisors to bring us closer to our clients as we race to build the best wealth management distribution network. The above investments provide a platform for growth in the coming years, as we look to cement our position as the leading real estate investment firm in Kenya and the region,” added Edwin.
According to the management, in a year when the average investor made single digit returns, and the stock market was down 8.5 percent, their investors realized returns ranging from 18 percent per year to 55 percent per year.
“With our strong corporate governance structure, our clients can be confident that their interests come first at all times,” said Elizabeth N. Nkukuu, CFA, Cytonn’s Chief Investment Officer and Head of Real Estate.
“We continue to develop institutional grade real estate, aimed at reducing the housing deficit, estimated at 200,000 units annually. Cytonn’s real estate platform, with a strong focus on execution and delivery of quality real estate product has driven our total investment portfolio to 12 developments, and Kshs 74 bn of projects under mandate,” she added.
Cytonn says that it has made heavy investments in real estate, with an 80.1 percent increase in their investment property portfolio to 10.1 billion shillings as at the end of 2016 from 5.6 billion shillings as at the end of 2015.
Revenue increased by 186.2 percent to 531.5 million shillings for FY’2016 from 185.7 million shillings for FY’2015, driven by their live real estate developments. The investment property in the development pipeline of 10.1 billion shillings had gains of 535.2 million shillings in FY’2016, which together with revenue growth of 186.1% highlights the attractive investment opportunity in real estate in Kenya and the region.
Group accounting profit for Cytonn came in at 116.1 million shillings with economic profit of 322.5 million shillings after removing one-off provisions and one-off items. This resulted in growth of shareholder equity of 44.2 percent to 5.3 billion shillings in 2016 from 3.7 billion shillings in 2015, and shareholder value per share increased by 50 percent, to 60 shillings per share as at FY’2016, from 40 shillings per share in FY’2015.