Vivo Energy’s revenue in the Kenyan market fell by $16 million (Sh2.06 billion) in the first half of 2024, as record high fuel prices hit demand.
The multinational said its Kenyan unit generated revenue of $769 million (Sh99.16 billion) during the six months, compared to $785 million (Sh101.22 billion) a year earlier, a slight decline of 2%.
The lower earnings also come despite a strong appreciation of the shilling against the US dollar during the period. The company sells fuel in Kenyan shillings, so the appreciation of the shilling boosts revenues in US dollars.
The local currency traded at an average rate of 159.7 shillings to the US dollar in January before rising rapidly by 18.8 percent to an average of 129.6 shillings per unit in June.
The Kenyan unit is Vivo’s second largest unit in terms of revenue share, after its Moroccan subsidiary.
“We have identified Morocco and Kenya as financially significant operating units based on their size compared to the group’s consolidated financial statements,” the company said in its annual report.
During the first half of the year, Vivo Energy Kenya was the only major segment to record a decline in revenue, while other major units such as Morocco and Senegal recorded significant increases.
The six-month period saw a historic rise in fuel prices, forcing some motorists to cut back on consumption.
Fuel prices hit an all-time high of Ksh207.36 per litre for super petrol in Nairobi in January, while diesel and kerosene also hit an all-time high of Ksh196.47 and Ksh194.23 respectively.
TotalEnergies, listed on the Nairobi Securities Exchange, recorded an 8.7% growth in net revenue during the first half of the year.
The oil marketing company posted a profit of Sh61.6 billion compared to Sh56.6 billion in the same period last year. Higher revenues and lower tax burden helped it achieve a net profit of Sh938.5 million, an increase of 14.09 percent from Sh822.6 million last year.
Vivo Energy is the largest oil marketing company in Kenya by market share. The company is the local marketer of the Shell brand.
According to data from the Energy and Petroleum Regulatory Authority, Vivo Energy Kenya’s market share stood at 22.02 percent as of December 2023. This puts it ahead of second-placed TotalEnergies, which had a share of 14.88 percent, while Rubis Energy Kenya closed the top three with a share of 14.05 percent.
The parent company, Vivo Energy, is listed on the London Stock Exchange (LSE) with a secondary listing on the Johannesburg Stock Exchange (JSE).
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