Homeboyz Entertainment Plc , an entertainment company in East Africa, says that its net profit for the year ending December 31st 2020 is expected to be considerably lower than the net profit reported at the end of December 31st 2019. In 2019, Homeboyz entertainment posted a net profit of KSh36.6 million.
The company expects its financial performance to improve as the economy recovers from the negative effects of the pandemic.
In a statement to investors, Homeboyz says it has secured contracts with “the Kenya Football Federation, Kenya Rugby League, WRC Safari Rally, East Africa Motor Sports Club, The Superbike Association, E-sports Federation of Kenya and the Magical Kenya Open”.
The entertainment company is the newest member on the Nairobi Securities Exchange (NSE) and the only listed entertainment company in Kenya. Its entry into the NSE in December 2020 was widely celebrated by investors and other stock market participants.
A research report by AIB-AXYS Africa released on December 21st 2020 highlighted the company’s key revenue drivers, including diversified sources of income, Homeboyz new business model based on long-term contracts, and the huge potential in the E-sports business. According to AIB-AXYS, risks to the business are high operating costs, change in customer preference, and the possible introduction of disruptive technology that may affect the firm’s profitability.
Homeboyz becomes the 19th listed company to issue a profit warning for the current financial year.