The Treasury earned Sh183 million (£1.2 million) from the joint venture between Kenya and British security printer De La Rue in the year to March 2021.
The earnings from the deal that took effect mid-April 2019 represents a 50 percent jump from the Sh122 million (£0.8 million) the Treasury earned from the venture—called De La Rue Kenya EPZ Limited—in the previous year.
Kenya’s increased earnings comes after the London Stock Exchange (LSE)-listed multinational’s net profit jumped 40.9 percent to £3.1 million (Sh474 million) in the year ended March.
National Treasury was allocated £1.2 million for its non-controlling interest of 40 percent that it acquired at a cost of Sh763 million (£5 million).
The deal gave the Kenyan government— one of the largest customers of De La Rue— an opportunity to recoup part of its currency printing expenses through profit-sharing.
The British multinational continues to operate and manage the joint venture given that it appoints three of the five directors who serve on the company’s board.
De La Rue Kenya EPZ was in 2018 handed a Sh12.96 billion (£85 million) three-year contract to design and manufacture Kenya’s new generation currency.
Besides local customers including the Kenyan government, the De La Rue factory also prints currency and documents for export to overseas clients.
De La Rue says all its four sites in the UK, Malta and Kenya sites continued to operate with minimal Covid-19 disruption.
Operations in Sri Lanka site were suspended for eight weeks due to island-wide governmental restrictions but it still delivered on printing targets for the year.
The multinational says its currency division benefited from a strong global demand for cash as central banks sought to increase stock levels during the pandemic. De La Rue projects a positive outlook for the year, which if achieved promises to deliver higher earnings for National Treasury.
“Trading for the first two months of financial year 2021/22 has been positive and in line with management expectations,” says the firm.
De La Rue has been implementing a turnaround strategy which ends in March 2023 and the management says this will have put the firm in a strong cash flow position to support dividend payouts to shareholders.