Kenya’s Uchumi Supermarkets posts US$68,000 profit as rental income drives recovery

KENYA – Uchumi Supermarkets has reported a modest profit of about US$67,692 (Sh8.8 million) for the year ending June 2025, a rare outcome for the financially strained chain that has relied heavily on leasing out its space to generate steady income.

The latest management accounts released under its company voluntary arrangement show that the retailer moved from a loss of roughly US$382,308 (Sh49.7 million) in the previous financial year, although the profit still fell short of the targeted US$98,846 (Sh12.85 million).

This marks the first time in several years that the chain has closed its books in positive territory, yet the achievement comes at a time when its future remains uncertain due to a court battle with the Kenya Defence Forces over the ownership of a 17 acre land parcel in Kasarani valued by Uchumi at around US$18.31 million (Sh2.38 billion).

Financial performance

The CVA report by Owen Koimburi of Forvis Mazars Kenya indicates that Uchumi’s sales revenue rose to about US$946,231 (Sh123.01 million) from US$503,077 (Sh65.4 million), lifting gross profit to roughly US$213,077 (Sh27.7 million) after accounting for US$733,154 (Sh95.31 million) in cost of sales.

Even with the improvement in retail activity, the biggest lift came from rental income which expanded to approximately US$482,308 (Sh62.7 million) from US$103,846 (Sh13.5 million), mainly because China Square took over the Lang’ata Hyper branch starting June 2024.

Koimburi noted that Uchumi’s financial trend points to gradual improvement, adding that management still needs to narrow the gap between what was planned and what has been achieved.

CVA progress and obligations

Uchumi currently hosts 11 tenants who collectively pay about US$45,692 (Sh5.94 million) monthly, with China Square contributing US$38,462 (Sh5 million) which represents more than four fifths of total monthly rent.

The CVA initiated in March 2020 outlined a six year debt settlement plan ending in June 2026, and the report shows that the retailer has paid roughly 95 percent of the US$1.89 million (Sh245.86 million) it aimed to clear by the end of the period under review.

Banks have been the largest recipients with about US$1.13 million (Sh146.5 million) settled, while trade creditors and landlords received nearly US$75,692 (Sh9.84 million) and staff salary arrears accounted for roughly US$52,538 (Sh6.83 million).

The report also shows that legal and preliminary costs stood at around US$479,692 (Sh62.36 million) while Mazars earned about US$38,462 (Sh5 million) for its oversight role.

Koimburi cautioned that Uchumi’s recovery remains tied to the appeal against the High Court ruling which handed the disputed land to the military, warning that an unfavourable verdict could derail the CVA unless fresh capital is injected or a revised plan is adopted.

Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.