BOC profit increases as Coronavirus drives up oxygen demand
Lewis Njoka @LewisNjoka
Increased demand for medical gases due to the Covid-19 pandemic saw BOC Kenya profit before tax for the year ended December 31, 2020 rise by 74.5 per cent to hit Sh156.3 million from Sh89.5 million in 2019.
The company said the performance was subdued in the first half of the year but improved progressively in the second half after the Covid-19 containment measures were eased.
‘The upside in results for the full year was primarily from medical gases, a revenue stream that has shown consistent growth over many years due to increased investments in both private and public sector healthcare facilities,” BOC said in its financial statement.
It said Covid-19 accelerated these investments in 2020, with the benefit of improved healthcare for the population expected to accrue well past the Covid-19 pandemic.
The pandemic, however, had mixed results for the gas manufacturer affecting negatively other segments.
Demand for industrial oxygen, other industrial gases, equipment and other products were depressed by a generally difficult macro-economic environment.
“Also in supplementing local production of medical oxygen with imported product to meet increased customer demand, the company incurred higher cost of importation that it could not fully pass to customers,” said BOC.
The company board recommended a final dividend of Sh4.15 per share to be paid on July 19 or thereabout.
This was an improvement from Sh2.35 recommended in 2019. Revenue rose to Sh1.1 billion from Sh975.9 million in 2019 while basic earnings per share rose to Sh5.21 from 2.86 the previous financial year.
In the near future, BOC says it expects the demand for oxygen to follow Covid-19 infection rates and hospitalisation trends.
“The company will therefore be seeking to ensure that adequate supplies of oxygen are available for its healthcare customers despite the difficulty of predicting infection rates and demand for oxygen,” BOC said.