Mumias Sugar warns of wider annual loss
10 September 2014, 14:05
Nairobi - Mumias Sugar warned on Wednesday that projected losses for the year to June 2014 would be bigger than the previous year's pretax loss of 2.24 billion shillings ($25.3 million).
"The company wishes to report that the projected loss for the year ended June 30, 2014, will be more than 25 percent compared to the loss reported for the same period in 2013," it said in a profit warning published in The Standard newspaper.
It blamed "a significant drop" in sugar prices due to illegal sugar imports and a shortage of cane due to a poor harvest. The company also said it was restructuring management to address the challenges.
Also read: Mumias Sugar sacks suspended executives
Mumias said in June it had dismissed two top managers who were suspended in April while the company investigated what it had said at the time was "questionable sugar sale and importation transactions".
Kenya has used high tariffs to protect its sugar farmers but the policy has encouraged smuggling of cheaper sugar imports.
The firm's shares closed at 2.30 shillings on Tuesday, after hitting a year low of 2 shillings on Aug. 20. The year high was 4.20 shillings, which it reached in March.
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