OLA Energy Kenya, a leading fuel retailer, has announced a strategic restructuring plan aimed at improving profitability and market share over the next five years. As part of the OLA Energy Kenya restructuring plan, the company has confirmed that it will implement a redundancy program.
While the company did not specify the number of employees affected, it assured that the process will be handled with sensitivity and in full compliance with Kenyan labor laws. According to its website, OLA Energy has over 1,500 employees and its operations create 20,000 indirect jobs.
The move comes as the company aims to streamline operations in response to rising costs and changing market conditions. The Kenyan subsidiary plans to improve profitability and expand its market share over the next five years.
In a statement, OLA Energy Kenya emphasized that the restructuring process will focus on aggressive sales enhancement and cost-cutting measures to reinforce its position as a key player in Kenya’s energy sector. The company noted that despite implementing a rescue action plan last year, challenges have persisted, necessitating a more comprehensive overhaul of its operations.
OLA Energy Kenya has faced increasing financial pressures, driven by fluctuating global oil prices, high operating costs, and evolving consumer demand. The company acknowledged that while past initiatives helped increase sales and reduce expenses, sustaining fixed costs remains a challenge.
“During the past year, OLA Energy Kenya initiated a rescue action plan with several initiatives to turn around the company’s trajectory, including increasing sales and reducing costs,” the company stated. “Through this restructuring, we are committed to reversing the current trends and positioning OLA Energy Kenya for sustainable growth.
OLA Energy Kenya remains one of the largest fuel retailers in the country, operating an extensive network of service stations and fuel terminals. The company serves over 500,000 customers daily across 17 African countries, including Kenya. It also provides fuel services at key locations such as Jomo Kenyatta International Airport (JKIA) in Nairobi.
In its report for the financial year ending June 30, 2024, EPRA ranked OLA Energy Kenya as the fourth-largest oil marketing company in Kenya. The company held a 5.93% market share and sold 324,154 m³ of imported fuel products locally by June 2023.
Kenya’s demand for oil products is largely driven by transport fuels, which account for 90% of total consumption. As the country’s passenger car fleet expands and economic growth accelerates, demand for gasoline and diesel is expected to rise steadily.
The restructuring is expected to help OLA Energy Kenya streamline its operations, increase efficiency, and maintain competitiveness in the energy sector. By reducing overhead costs and implementing targeted sales strategies, the company aims to enhance its long-term sustainability and profitability.
While the restructuring process presents immediate challenges, OLA Energy Kenya remains optimistic about its future. The Kenyan fuel retail market is undergoing significant changes, with increasing competition from local and international players. The company’s ability to adapt to these shifts will determine its long-term success.
Over half of the total retail network is under the control of one of the five largest fuel retailers. These include international firms Vivo Energy, TotalEnergies and Rubis, as well as the State-owned National Oil Corporation of Kenya (NOCK). The remainder of the retail network is primarily made up of indigenous players with ten sites or less.
With this strategic realignment, OLA Energy Kenya aims to fortify its market presence, ensuring it remains a top energy retailer in the region. The company reiterated its commitment to providing high-quality energy solutions to Kenyan consumers and businesses.
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