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CMC board attributed the profits to cost cutting and favourable foreign exchange environment/FILE

Kenya

CMC returns to profitability

CMC board attributed the profits to cost cutting and favourable foreign exchange environment/FILE

CMC board attributed the profits to cost cutting and favourable foreign exchange environment/FILE

NAIROBI, Kenya, Jan 31 – CMC Holdings has announced a net profit of Sh105million for the year ended September 30 2012 from a net loss of Sh181 million in 2011.

In a statement, CMC board attributed the profits to cost cutting and favourable foreign exchange environment.

Net foreign exchange gains went up from Sh17.5 million in 2011 to Sh235.3 million in 2012.

The group reported a profit before taxation of Sh231 million up from a loss of Sh209 million in 2011.

However turnover remained at the same level as the year 2011 at Sh11.8 billion.

“The group performance was impacted by the huge increase in bank interest rates which resulted in borrowing costs increasing to Sh909 million from Sh440 million in 2011. This was despite the reduction of borrowings from Sh5.1 billion in 2011 to Sh 4.2 billion in 2012,” the group said in a statement.

The value of total assets dropped to Sh12.9 billion in 2012 from Sh14.5 billion during the previous year.

Shareholders will however be disappointed after the board announced a zero dividend.

Since last September 16, their shares remain suspended from trading at the bourse following shareholder and boardroom wrangles which led to ousting of Peter Muthoka as chairman.

CMC CEO Bill Lay had accused Andy Forwarders, a logistics firm owned by Muthoka, of overcharging the auto dealer to the tune of Sh1.5 billion over a period of five years.

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Meanwhile the auto firm says it will announce the date of the Annual General Meeting to the shareholders.

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