NAIROBI, Kenya, Aug 31 – Mumias Sugar Company has announced a 34 percent drop in its pretax profit for the full year ending 30 June 2012, from Sh2.6 billion in the previous financial year to Sh1.8 billion.
The company attributes the drop to decline in the amount of sugar cane processed during the period which went down by 15 percent from 1.9 million tonnes of cane compared to 2.2 million in 2011.
This was due to a decline in the cane availability.
However profit after tax increased by four percent from Sh1.9 billion in 2011 to Sh2 billion attributed to a tax credit as a result of commissioning the ethanol plants and the water plant.
Earnings per share went up by four percent from Sh1.26 in 2011 to Sh 1.31 this year. Gross turnover dropped to Sh18.7 billion compared to Sh18.8 billion in the last financial year.
The sale of power from its co-generation plant went up by 23 percent from Sh313 million in the previous year to Sh435 million in 2012.
In the period, the company produced 172,614 million tonnes of sugar down from 235,812 million tonnes produced in the 2011 financial year.
The company says the efficiency was lower and hence less sugar was recovered thus compounding the problem of declining cane supply to the last financial year.
As one of the strategies in the coming financial year, the firm plans to set up additional sugar cane buying centres in its cane zone to enable easier collection from the fields, minimize in –transit losses and reduce poaching of cane by its competitors.
The sugar firm also believes this will enhance efficiency of the factory due to a regulated and constant flow of cane crashing since the buying centres also act as buffer storages.
Despite the challenges faced by the company during the period, board of directors has recommended a first and final divident of Sh2 per share to all its shareholders which will be paid to the sharholders on November 2, 2012.