Mashada Blogs » June 12, 2009

Jellyfishcoolman's Blog: TEAMS officially Launched.

2009-06-12T20:54:40-04:00

Dear Friends. Finally after years of waiting TEAMS [The East African Marine System] fibre-optic cable is finally here. It was officially launched today Friday 12th June 2009. The project has been some years in the making and it’s arrival is the realisation of a long held dream by the Kenyan government after having some problems with EASSy [...]

You Missed This: A Terrible Way To Die: Flight 447 We Remember

2009-06-12T15:32:00-04:00

There are many ways people die but over the last couple of days the way in which passengers of the doomed Air France flight 447 may have died has haunted me and refused to leave my mind.

Conclusive investigations are of course far from being completed while other experts say that we will probably never know what really happened. Still one can imagine the following scenario;

The aircraft enters serious turbulence which naturally causes fear when you are that high above the ground as the aircraft shakes violently. Suddenly all the lights go off and there is pitch darkness (because it was a night flight). The next thing that happens is that the aircraft suddenly breaks apart and passengers can immediately feel the decompression of the cabin which causes breathing problems. So the poor passengers suffocate as they fall into dark nothingness. Most, if not all would be dead long before their bodies hit the icy waters thousands of feet below.

What also disturbs me about this accident is the fact that strange things always seem to happen when an Airbus accident is being investigated, something that this article brings out so well.

Aviation is a subject that has always fascinated me, more so it's history. Great risks were taken to make what we take for granted today possible. The first ever aircraft accident in history is instructive. Scroll down to the last article on this page to read a brief amazing history of how mechanized flight was discovered.

Get detailed latest information on this air disaster.

What Kumekucha has been reading;

I found this web page discussing the accident fascinating. More so because there were comments from several experts.Kumekucha

Rants, Raves & Reviews: Kenya's winners after the tough times

2009-06-12T14:39:00-04:00

Just a quick overview
Equity Bank - Acquisitions + Organic growth will propel it to the #2 Kenyan bank by 2012. Plenty of cash for NBK and/or HFCK acquisitions.
KCB Bank - Organic regional growth but need to raise cash in 2010. Huge bet on housing in E. Africa will propel lending.
EABL - The classic tortoise expansion strategy into regional markets. Dominates Kenya but strong challenger (SABMiller) elsewhere but Tanzania is no-go for EABL. Ethiopia is the Holy Grail for EABL. Cash is a-plenty plus Diageo is always there if needed.
KQ - Huge hedging 'paper' loss in 2008-9 which will translate 'cash' loss of cash by Dec 2010 but KQ generates plenty cash from operations. Cash-flow + cash hoard ($100 million)allows for route & fleet expansion. Dominates many African markets but Ethiopian Airlines is tough African rival. Other competitors expanding but Africa is littered with dead airlines.
KenolKobil - Expansion is afoot & the cash is available. Borrowings mostly short-term to finance inventory. Kenya is the largest & toughest market but KK hints acquisitions in Central & Southern Africa. Smart, lean, responsive & voracious management.
AccessKenya - Huge capex in laying cable in Nairobi. Other metros will follow. Push for SoHo customers. Remains a juicy acquisition target. I expect Access to enter Tanzania & Uganda after SEACOM goes live in 4Q 2009.

the-undergraduate: Sorry :'(

2009-06-12T11:59:00-04:00

I used to think i knew what being down to earth was all about
I thought i knew what being kind and appreciative of others meant
I thought i knew how to be friendly,knew how to be loving

I even thought i knew quite alot about compromise
Thought i knew how to thank those around me for all they did for me
But now i know better

Sad i had to loose quite alot before i realized all this
Sad i cant get back what i want most

If i could id change quite alot
I wish i could get my life back on track,cos what i had is probably as close as perfect gets

Am sorry

Never again will i ever take anything fore granted
Never again will i ever get too comfortable knowing that alot can change in under a minute

For Love and Money: Kenya Budget Word Cloud

2009-06-12T11:27:00-04:00

Kenya Budget Word Cloud

Storymoja: Story of the Week – May 8th, 2009

2009-06-12T11:11:14-04:00

Your votes are in and the story of the week is… Jezebel by Cliff Oluoch… Read it here Join us here on Monday for the next batch of stories and be sure to vote for the Story of the week June 15, 2009. If you would like your story to compete for the Story of the Week, [...]

bankelele: Mobile phones lower the cost of business

2009-06-12T10:38:00-04:00

Money Transfer Within Kenya Part 3

A comment from @alykhansatchu on Money transfer lead to an update of the first post about money transfer from about 3 ½ years ago before the advent of mobile money transfers.

At that time, the cost of sending 10,000 shillings (then about $136) within Kenya was Kshs. 1,700 ($23) with Western Union and 1,850 ($25) with Moneygram - working out to a remittance cost of about 17% - 19% for an instant money transfer. This was mostly done at a few commercial bank branches, some foreign exchange bureaus, and at post offices around the country within banking hours.

90% savings: A lot has happened in the last few years mainly in the form of the arrival of money transfers via mobile phones by MPesa from Safaricom and more recently Zap from Zain.

A recent post last week noted that Western Union in Kenya have just lowered transfer costs to flat rates of 2% i.e. almost 88% cheaper than what they were at the time.

In the last few years, millions of Kenyans have moved on to mobile phones for money transfer and I can’t recall anyone who uses banks for these transactions. Mobile phone have maximums of about $430 (35,000 shillings) for money transfers, but this is more than enough to cater for most remittances, including the emergencies that necessitate instant transfers.

And mobiles are still cheaper; the 2% western union charge to transfer 10,000 shillings works out to about 200 shillings. A transfer of the same amount by Zap costs 75 shillings (0.75%) and 105 shillings (1.05%) by M-Pesa (after combining sender and receiver fees)

International remittance to get cheaper?: Zain hope to link Zap to allow transfers to customers of Zain in different African countries. And Safaricom are setting up a link for transfers from the United Kingdom to Kenya. When these are established, we should also see the cost of internal remittances, whose sometime high cost is a cause for complaint for many Africans in the Diaspora, also drop significantly.

Black Looks: HRW: Organizing around Sexual Orientation & Gender Identity

2009-06-12T05:49:41-04:00

Human Rights Watch publishes the results of a qualitative survey of 100 sexual rights activists from 50 countries on issues of gender identity and sexual orientation. From an African perspective the findings of “Together Apart”are predictable but it is helpful and supportive to know that activists face similar challenges across the world. [...]

bankelele: Athi River Mining Board evicts Bamburi Cement as Director

2009-06-12T00:34:00-04:00

Excerpts from the 2009 Athi River Mining annual general meeting (AGM)

Athi River Mining, Kenya’s 3rd largest cement company held its annual general meeting (AGM) on June 11 2009 at the Grand Laico Regency Hotel. It was mainly presided over by the Chairman Mr. Palle Rune and Managing Director Pradeep Paunrana.

After the finance director gave a review of 2008 performance – sales of 4.6 billion ($58 million) and a profit of 503 million ($6.3 million) (but had an error column labeled 2009 numbers and skipped over the net current assts position instead focusing on global credit rating A1 rating of the company)), the MD took over and outlined his plans for the company going forward along with a talk on the state of the cement business in East Africa.

ARM Outlook
- ARM had no cement growth in 2008 because they are at full capacity, and same with fertilizer. fertilizer sales rose sharply to almost 1 billion shillings, but that was because the price of fertilizer shot up in Keya. It is mainly sold o tea farmers, cheaper than fertilizer imported by KTDA and gives better yield. Silicate sold mainly export markets Mozambique, Malawi, SA
- 26% of ARM sales were from exports, but were hampered by strong shilling
- Project to haves sales of 6 billion in 2010 rising to 13.4 billion by 2012
- Currently produce 1,000 tons per day for the Kenya market that has 5,000 tones per day production capacity. With new plant in Tanzania, ARM will go to 2,000 tons per day from January 2010 - the new plant in Tanzania will be largest plant in east Africa
- improved production efficiency: now have the best margins in cement production in Kenya, ahead of Bamburi and a distant EAPC.
- improved energy efficiency in cement production - East Africa. Saved 16% (about25m) in 2008 and expect to save about 50 million in 2009 – they have achieved international benchmarks
- building their own clinker plant in Tanzania, locally produced clinker cheaper than imported clinker by about 1/3

Cement in EA
- Cement a growth business, and there’s great demand in this part of Africa for building work, and in the future for roads
- Cement grows at 2x GDP in east Africa , and has been at about 15% p.a. for last few years
- Comparing cement companies across region shows a variation in pre-tax profit margins ranging from 36% at PPC (SAfrica) and Tanga (Tanzania), while in Kenya Bamburi was 18%, ARM 17% and EAPC -13%
- Egypt became a new importer of cement in 2008

Shareholder Q&A
- borrowing costs are high and growing, why? high borrowing for expansion- they chose that route instead of the equity one. which will probably strenthen Bamburi's position
- acquired minority shares in Tanzania subsidiary, but did not get Kenya shareholder approval, why not? Chairman said they’d never get anything done if they had to bring such things to a vote
- Why not sell cement in south Sudan and Rwanda? Wont go for those markets, they are focused now on the highly profitable Tanzania market, and less profitable S. Sudan market is better served by rivals (tororo and hima)
- when will shareholders visit new Kaloleni plant as promised by the board? perhaps AGM next year will be held there, but its open year round for any shareholder to visit
- why is ARM cement and fertilizer not seen in retail shops around the country ? MD explained that virtually all their product was sold to repeat customers – e.g. contractors who took the cement at factory to building sites, and same with tea farmers

Hot Button moment: director elections
Three directors were up for re-election – Bamburi Cement, Michael Gondwe and the deputy chairman H. Paunrana, none of whom were present or reprsented.

Bamburi Cement, a rival and Kenya’s largest cement producer own almost 14% of company, and are second largest shareholder in company. Bamburi had not sent a representative, and their reserved seat at the board dais was empty
- The Chairman recommend that shareholders vote against the re-election of Bamburi. He said it was clear that Bamburi does not want ARM to grow or produce more cement. They have been trying to sabotage ARM in international circles. I noticed in the minutes of last years meeting, for the vote to split the company management, Bamburi had requested a poll vote be taken. Chairman summed it up by saying that the board was not comfortable disusing ARM company business in the presence of a Bamburi representative
- One Shareholder queried if company had obtained legal advice to which chairman answered yes the board had even got two opinions
- Another shareholder feared that if Bamburi were voted out and then dumped their shares, it would affect other investor; the deputy MD replied that snares would be snapped up quickly and said Bamburi rights as a shareholder and director were separate unrelated matters
- Another shareholder asked about an ongoing land dispute between ARM and Bamburi for limestone deposits; CEO summed it up as follows: ARM scouted and located a deposit of limestone. Signed a least for 540 acres with Kitui town council. Bamburi tried to get this overturned, and the former Local Govt. Minister Musikari Kombo had tried to broker a sharing arrangement. Bamburi got high court injunction and ARM and Kitui council have now gone to court of appeal, a process that may take years. Courts and government tried to broker a settlement, but two companies are too far apart
- After the arguments shareholders present unanimously voted against the re-election of Bamburi as a director of the company.
- The two other directors, though absent, were re-elected unanimously. Mr. Gondwe of PTA, the company’s bankers had given his apologies as he was involved with other bank business on that day, while Mzee (old man) Paunrana, though over 70 was described by other directors as being a key guide in day to day management of company (not just a honorary deputy chair)

Goodies: T-shirt, tote-bad, keychain, lunchbox from the Laico