Unga Ltd posts H1 profit jump, new taxes a strain
28 February 2014, 22:20
Nairobi - Flour miller Unga Group Ltd reported a 53 percent jump in pretax profit in the six months ended December, helped by slim foreign exchange gains after heavy losses on the local currency the year before.
The miller said profit before tax rose to 298.7 million Kenyan shillings during the first half as net revenues climbed eight percent to 8.8 billion shillings.
However, the firm said new taxes in east African economies were putting a strain on margins.
"The introduction of VAT on animal nutrition products resulted in reduced demand as farmers sought alternative sources," the company said in a statement.
Meanwhile, a new 10 percent duty on wheat imported into Uganda and a 60 percent import duty on flour brought into Uganda from Kenya meant that illegal imports would pose an increasing challenge to Unga's Ugandan subsidiary.
Earnings per share increased to 1.61 shillings from 1.12 shillings. The firm did not recommend the payment of interim dividend.