(NAIROBI, KENYA) – Britam Holdings has cleared accumulated losses of KES 5.87 billion ($45.7 million / £35.6 million) from its balance sheet, opening the way for the resumption of dividend payments after a six year pause. The Nairobi Securities Exchange listed insurer said the reduction became effective on 7th September after the Registrar of Companies registered a High Court order and the statement of capital approving the transaction.
The Companies Act bars an institution from paying dividends if it has accumulated losses. The completion of the transaction, which was initiated in March, has seen Britam’s share premium account fall to KES 7.36 billion ($57.3 million / £44.7 million) from KES 13.24 billion ($103 million / £80.4 million). The KES 5.87 billion reduction cleared the accumulated losses.
Share premium represents the amount investors paid above the company’s assigned share value. Britam said the reduction in the share premium account corresponds with an elimination of accumulated losses, and the company’s underlying financial position remains unchanged.
An accumulated loss is the total amount of money a business has lost over time that has not yet been covered or paid off by profits. Britam’s move removes the balance sheet constraint that had prevented it from rewarding shareholders despite returning to profitability.
The insurer’s last dividend payment was in 2019. The company had accumulated losses of about KES 5.8 billion ($45.1 million / £35.2 million) at the end of 2025, preventing it from declaring a dividend despite posting profits for five years. Britam fell into an accumulated loss position for the first time in 2020, when a record loss of KES 9.1 billion ($70.8 million / £55.2 million) wiped out the entire KES 1.77 billion ($13.8 million / £10.7 million) retained earnings it had the previous year.
The insurer’s net profit rose to KES 5.53 billion ($43 million / £33.6 million) in the year ended December 2025, from KES 5.03 billion ($39.1 million / £30.5 million) a year earlier. In the half year ended June 2026, Britam’s net profit rose by 53.3% to KES 2.666 billion ($20.7 million / £16.2 million).
The company had signalled in March that clearing the accumulated losses through its share premium account would allow it to resume shareholder payouts. Britam Managing Director Tom Gitogo said in March that the company chose to use KES 5.8 billion of the KES 13.2 billion share premium to clear the accumulated loss balance so that it can pay dividends, including possibly an interim dividend.
The latest development completes the process that began with the board’s proposal in March and shareholder approval on 21st May. The High Court confirmed the transaction on 30th July and approved the statement of capital reflecting Britam’s revised capital structure. The Registrar of Companies registered the court order and statement of capital on 7th September, making the reduction effective.
Britam said the restructuring has not affected shareholders’ interests, with investors retaining the same number and class of shares they held before the transaction. The transaction did not reduce the insurer’s equity or net assets because it involved an accounting transfer within the balance sheet rather than a distribution of assets.