Letshego Africa Holdings has refuted recent Kenya media claims suggesting default on loans in Kenya and Uganda, clarifying that such reports are inaccurate and misleading.
In response to a headline published by Kenyan Nation Media group on July 5, 2024, alleging “Botswana’s Letshego defaults on Kenya, Uganda loans,” Letshego Africa Holdings stated unequivocally that it has not defaulted nor failed in servicing any obligations across its subsidiaries. The financier categorically denied claims of default by Letshego Kenya and Uganda, asserting these assertions as false and incorrect.
The clarification follows the group’s annual results for 2023, initially released on March 22, 2024, which disclosed adjustments in Expected Credit Loss (ECL) methodology impacting financial results and necessitating restatement of 2022 figures. While acknowledging breaches in covenants with certain funders due to these adjustments, Letshego Africa Holdings emphasized that it had proactively engaged with funders and secured formal ‘letters of no action’ regarding these covenant breaches.
Despite these challenges, Letshego Africa Holdings assured stakeholders of its robust financial position, highlighting its solid liquidity and strong capitalization. The group expressed gratitude to stakeholders, including funders and investors, for their continued support in advancing its pan-African inclusive finance strategy.
Letshego’s 2023 revenue grew by nine percent to P3.4 billion, however, this was offset by a 23 percent jump in interest expenses that totalled P1.7 billion. Factoring in other incomes, the group reported net operating income of P1.8 billion, which was 14 percent lower than the previous period. Operating expenses surged by 20 percent to P1.7 billion, resulting in profit before tax of P121 million, reflecting a significant 82 percent decline from the P684 million pre-tax profit reported in December 2022.
With tax deducted, Letshego found itself posting a P149 million loss, a stark contrast to the P352 million profit in the prior comparable period. The 2023 financials marked the first time that the Botswana domicile group reported a loss in more than a decade.
