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Uchumi of Kenya Gains to 1-Week High on Dividend: Nairobi Mover

Oct. 23 (Bloomberg) -- Uchumi Supermarkets Ltd., Kenya’s best-performing stock this year, climbed for a fourth day to its highest in a week after the company declared a dividend for the first time since 2002.

Shares in Kenya’s only publicly traded retail chain gained 1.6 percent to 19.25 shillings by 1:40 p.m. in the capital, Nairobi. A close at that level will be the highest since Oct. 16.

“It’s going up because of the dividend,” Eric Munywoki, a research analyst at Nairobi-based Old Mutual Securities Ltd., said by telephone. “As the new branches mature, we expect them to contribute to both the top line and bottom line.”

Uchumi on Oct. 17 said full-year profit fell 30 percent to 274 million shillings ($3.2 million) in the 12 months through June, as operating expenses jumped 48 percent after it opened new stores in Kenya and neighboring Uganda and Tanzania. Revenue increased 29 percent to 13.9 billion shillings. It declared a dividend of 0.3 shillings a share.

During the fiscal year to June 30, Uchumi opened three outlets in Uganda and one each in Tanzania and Kenya for a total of 24 stores, according to a statement on the company’s website. Uchumi’s stock has more than doubled this year, compared with a 32 percent gain on the NSE All-Share Index.

To contact the reporter on this story: Eric Ombok in Nairobi at eombok@bloomberg.net.

To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net

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