CMC motors hit by higher costs and lost franchise
03 February 2014, 08:36
Nairobi - Kenyan car retailer CMC Holdings on Friday posted a 14 percent drop in pretax profit to 199.85 million shillings in the year to September 30.
The company, which is the subject of an $86 million takeover offer by Dubai's Al Futtaim Group, blamed higher costs and staff expenses for the drop.
Sales costs rose 6 percent to 9.78 billion shillings during the period, while an extra 85 million shillings went towards a backdated salary increase for staff and redundancy payouts after the loss of its Jaguar Land Rover franchise.
CMC distributes Ford, Suzuki and Volkswagen vehicles among other brands in the region.
Thanks to a 35 million shilling fall in CMC's tax bill, earnings per share edged up to 0.19 shillings from 0.18 shillings.
The shares have been suspended from trading on the stock market while shareholders consider Al Futtaim's takeover offer.