Kenya’s major sugar company has doubled its losses in a span of 1 year.
The troubled Mumias Sugar company has recorded a loss of KSh15.1 billion from KSh6.8 billion loss booked in June 2017.
It is the sixth year in a row that Mumias Sugar has announced a loss in its year-end results.
The NSE listed company missed several deadlines for reporting its financial results for the year that ended in June 2018.
Mumias blamed sugarcane shortage and steep rise in impairment costs for the massive loss. Impairment charges for its plant and machinery amounted to KSh4.9 billion in the period under review.
The firm’s revenues dropped by 34 percent to KSh 1.37 billion. Its operating costs also declined by 17 percent to KSh1.9 billion from KSh2.3 billion earned in 2017.
Between June 2015 and December 2017, Mumias received KSh3.2 billion in government bailouts. In September 2018, the company requested an additional KSh2 billion bailout from the Treasury.
At the time, it’s board Chairman Mr. Kennedy Ngumbau said, “We have put in place a viable plan that will put the miller back on track if the money we are expecting from the national treasury is released.”
Following the huge loss in the 2018 results, the company’s directors did not recommend a dividend payout.
Recently Hon. Raila Odinga met western Kenya sugar stakeholders in Kisumu and proposed privatization of sugar firms.