Kenya Literature Bureau (KLB) recorded a dramatic drop in earnings for the financial year ending June 30, 2025, posting a net profit after tax of KSh 12.2 million, down 90.7% from KSh 131.0 million the previous year. The decline came as gross turnover fell 46.4% to KSh 1.828 billion, bringing an end to three straight years of revenue expansion that had peaked at KSh 3.410 billion in FY2023/24.
Despite the revenue contraction, the state-owned publisher managed to widen its gross profit margin to 45.7%, up 11.6 percentage points from the previous year. This improvement followed a sharper reduction in cost of sales, which dropped 55.8% to KSh 992.9 million, outpacing the fall in turnover.
KLB attributed the stronger margins to a shift toward higher-margin open-market and collaborative printing work. Commercial printing assignments for institutions including the Kenya Institute of Curriculum Development (KICD), the Kenya National Examinations Council (KNEC), and the Kenya Universities and Colleges Central Placement Service (KUCCPS) generated KSh 67.7 million, partially cushioning the decline in government publishing orders.
However, the bureau’s financial performance was heavily affected by delays tied to a KSh 1.026 billion contract with KICD. The agreement involved the printing and distribution of Grade 1 to Grade 4 mathematics learner books and teachers’ guides, split across four sub-contracts with a delivery deadline of May 6, 2025.
An audit inspection carried out in July 2025 across Murang’a, Kirinyaga, Machakos, and Kajiado counties found that the textbooks had not yet reached most schools. Only Murang’a School for the Hearing Impaired had received the materials. With just two months left in the academic year, the Auditor-General warned the delays could disrupt the rollout of the Competency-Based Curriculum (CBC).
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KLB management attributed the backlog to late confirmation of final distribution quantities by KICD, a setback that pushed roughly KSh 34.1 million in related costs into the FY2025/26 financial period.
Costs Held in Check as Liquidity Improves
Operational spending declined during the year, offering some relief to the bureau’s bottom line.
Total operating expenses dropped 17.4% to KSh 864.8 million, the lowest level in three years. Selling and distribution costs fell 34.5% to KSh 365.7 million, while administrative expenses remained largely steady at KSh 499.1 million.
Meanwhile, finance income rose 5.7% to KSh 41.2 million, supported by short-term deposits earning 11.85% interest and Treasury bills yielding 8.77%. The bureau’s cash and cash equivalents improved to KSh 320.7 million, up from KSh 241.3 million the previous year.
Notably, KLB maintained a debt-free balance sheet, carrying no borrowings across the five-year review period, which left the institution with zero gearing.
Still, profitability deteriorated sharply. Profit before tax dropped to KSh 30.0 million, down from KSh 164.5 million in FY2023/24. That figure represents the bureau’s weakest performance in the five-year period reviewed, after earlier growth from KSh 88.4 million in FY2020/21 to a peak of KSh 168.7 million in FY2022/23.
Even so, shareholders’ funds continued to rise modestly over the period, climbing from KSh 4.275 billion in FY2020/21 to KSh 4.480 billion in FY2024/25, largely supported by accumulated retained earnings.
Key Financial Metrics
| Metric | FY2024/25 (KShs) | FY2023/24 (KShs) | YoY Change |
|---|---|---|---|
| Gross Turnover | 1.828Bn | 3.410Bn | ▼ -46.4% |
| Gross Profit | 835.2Mn | 1.162Bn | ▼ -28.2% |
| Gross Profit Margin | 45.7% | 34.1% | ▲ +11.6pp |
| Total Operating Expenses | 864.8Mn | 1.047Bn | ▼ -17.4% |
| Net Profit Before Tax | 30.0Mn | 164.5Mn | ▼ -81.8% |
| Net Profit After Tax | 12.2Mn | 131.0Mn | ▼ -90.7% |
| Inventories | 2.771Bn | 2.194Bn | ▲ +26.3% |
| Trade & Other Receivables | 1.049Bn | 2.339Bn | ▼ -55.2% |
| Short-term Deposits | 304.2Mn | 217.4Mn | ▲ +39.9% |
| Total Current Assets | 4.141Bn | 4.774Bn | ▼ -13.3% |
| Total Assets | 5.910Bn | 6.600Bn | ▼ -10.5% |
| Retained Earnings | 2.507Bn | 2.540Bn | ▼ -1.3% |
| Dividend Declared | 1.2Mn | 13.1Mn | ▼ -90.7% |
Audit Concerns and Governance Gaps
The Auditor-General issued a qualified opinion on the bureau’s accounts, highlighting KSh 251.5 million in receivables outstanding for more than 90 days. The audit also noted that nine issues raised in previous audits remain unresolved.
Governance challenges were also flagged. Three statutory board positions were vacant during the period under review, placing the institution in breach of provisions outlined in the Kenya Literature Bureau Act.
Dividend Slashed
In light of the earnings decline, the board proposed a dividend of KSh 1.2 million, representing 10% of after-tax profit. The payout marks a 90.7% reduction from the KSh 13.1 million distributed the previous year.
The proposed dividend continues a downward trend, having fallen steadily over the past five years from KSh 18.9 million in FY2022/23 to its current low.
