Mumias Sugar trims loss, says cane theft a problem
20 February 2014, 10:44
Nairobi - Mumias Sugar reported on Thursday a narrower loss in the six months ended December as it increased revenues and cut costs.
It said illegal imports of cane as well as poaching by rival millers had hit business, but it expected further improvements in the second half of its financial year.
The country's biggest grower and miller of sugar narrowed its pretax loss to 104.8 million shillings, from 1.58 billion shillings in the six months ended December 2012.
Net revenues increased 31 percent to 7.1 billion shillings, after a 29 percent rise on sugar sold to 88,851 tonnes, and despite a small drop in sugar prices.
"Cane availability is still a major challenge as a result of lower area under cane, declining yield per hectare and cane poaching by other millers who have not developed their own cane," Mumias Sugar said.
Mumias announced its results before the local bourse opened.
Kenya's sugar industry regulator forecasts the country's raw sugar output will grow 17 percent to 700,000 tonnes in 2014, helped by an improved supply of cane and higher factory capacity.
Mumias said costs fell by almost a third to 1.5 billion shillings and its loss per share narrowed to 0.05 shillings from 0.72 a year earlier.
The company said performance was also hurt by illegal imports as well as cheaper imports from Common Market for Eastern and Southern Africa (COMESA) trade bloc.
"The company looks forward to better performance in the second half of the year despite challenges as supply of sugarcane is expected to improve due to adequate rainfall during the period under review," it said.