De La Rue, which prints banknotes, has incurred an extra cost of £1.3 million (KSh 258.04 million) as it exits the Kenyan market. De La Rue staff at a past event. The amount was spent on laying off staff, writing off assets, and paying lawyers as part of the process of closing down its Nairobi unit. The overall expenditure for shutting down the Nairobi unit now stands at £13.9 million (KSh 2.77 billion). “Since this programme commenced, £13.9 million of costs have been incurred in relation to this. Minimal further costs are expected in relation to this programme in the financial year 2024,” the company stated in its latest financial report. Why De La Rue exited the Kenyan market In January 2023, the banknote printer scaled down operations in the country, due to the low market. The 40% state-owned firm announced cutting its workforce by 300 employees. De La Rue revealed it had not received a printing order from the Central Bank of Kenya (CBK). “Government is not currently printing any new notes. Those of us who were dealing with notes left. The company received the last order of banknotes up to September 2022,” said former employees, quoted by Business Daily. The company released about 132 employees on contract and permanent terms between July and September 2022. De La Rue’s last biggest tender was the KSh 13 billion 2018 order that saw the firm design and produce new banknotes. The firm reported a 58% slump in its net profit from the Kenyan wing from KSh 184.5 million to KSh 76.9 million in September 2022. What next for De La Rue? The UK-based firm noted that its joint venture with Kenya remains active and will restart production “if the economic climate permits”. De La Rue continues to operate with three banknote sites in the UK, Malta and Sri Lanka. This is a reduction from five sites in 2020. The High Court in Nairobi dismissed an appeal from one of De La Rue’s subsidiaries related to a historical tax issue, equating to KSh 1.1 billion.
by Japhet Ruto