Sasini Records Over KSh 657.5m Drop in Profit, Cites Tough Economic Times

 

Kenya's tea manufacturer, Sasin PLC, has reported a significant drop in net profit. Sasini PLC Managing Director Martin Ochien'g speaking at a past event. The company's financial records for the year ending September 2023 indicated a net profit of KSh 542.55 million. Sasini PLC profit This represented a KSh 657.5 million or 53% drop from the KSh 1.2 billion reported profit after tax reported during a similar period in 2022. . Sasini also reported a 22% drop in turnover to KSh 5.72 billion during the same year under review, from KSh 7.34 billion in 2022. The member of the Sameer Group attributed the decline to multiple economic shocks and uncertainties exacerbated by harsh economic conditions reported during the year. Drop in world coffee and macadamia prices Other factors that led to the reduction in profit included a recession in production and world commodity prices. The company also felt the heat following a significant drop in Macadamia prices globally. Why Sasini issued a profit warning Sasin PLC sales reduced to KSh 4.35 billion, down from KSh 5.5 billion reported in the previous year. This saw the company issue a profit warning in November 2023, citing an escalation in the cost of doing business and a severe drought that affected production.  "The major challenges during the year were occasioned by high cost of production due to unplanned escalation of input costs, the severe drought witnessed in the first six months, lower than expected coffee prices and the severe recession in the world commodity prices," said Sasini. Sasini is among a dozen Kenyan companies that issued a profit warning for the year ending December 31, 2023. The Nairobi Securities Exchange (NSE) listed companies cited a tough business environment and reduced purchasing power. Stanbic Bank Kenya's Purchasing Managers Index (PMI) for November 2023 showed that most firms experienced reduced operations and output levels, leading to job cuts. 

by  Wycliffe Musalia