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FINANCIALS

Sasini posts Sh122million net profit in half year results

The improved performance is attributed to improved coffee prices, good weather conditions and cost containment measures

In Summary
  • The firm posted Sh122million in net earnings, up from a Sh13 million loss in the first half of 2020 when the Covid-19 pandemic hit.
  • Sasini which exports tea, coffee, macadamia, avocado and other agricultural produce, is optimistic about the second half of the year.
Farmers picking tea in Kangaita village
'TEA IS AN INVESTMENT': Farmers picking tea in Kangaita village
Image: FILE

Agricultural firm Sasini's has bounced back to profitability posting a net profit of Sh122million in half-year period ended March 31 2021 up from a Sh13 million loss in the same period last year.

The firm attributes the improved performance to improved coffee prices, good weather conditions and cost containment measures.

Mechanisation of the tea harvesting process led to significant cost reduction for the company.

The tea producer cut its workforce by 1,364 staff in 2020 after acquiring the tea harvesting machines.

The firm noted that coffee and tea production volumes were within expectations but the global slowdown in the macadamia business and the late start of the avocado season meant that the first six months results relied heavily on tea and coffee businesses.

A decline in tea prices and low demand for tea and coffee led to a two per cent dip in revenue to Sh2.024billion at the end of March 2021, from Sh2.070 billion in March 2020.

"Despite disruptions in the supply chain, reduced demand and the depreciation of the local currency we were able to remain resilient leading to this improved performance," the firm said in it's financial statement.

Sasini which exports tea, coffee, macadamia, avocado and other agricultural produce, is optimistic about the second half of the year.

The start of the avocado season in April and increased shipment of macadamia nuts are expected to boost the company’s revenue in the remaining six months of the year.

In addition, Sasini is counting on the prevailing good weather and improved tea prices to deliver good financial results at the end of the year.

The company’s directors recommended a payment of an interim dividend of Sh0.50 for every ordinary share to investors on the register at the close of business on June 2 2021.

The interim dividend payment will amount to Sh114 million.