The Kitui County Textile Company is on the verge of collapse despite its huge potential to raise revenue for the county government, an assessment report says.
The report by the Kitui county motor vehicles, plants and equipment assessment task force said the garment making factory is fiscally on its knees despite making the revenues amounting to Sh614 million.
Kicotec was set up by former Kitui governor Charity Ngilu and hit the headlines during the Covid-19 pandemic after it converted to a face mask making line.
Ngilu's successor, Julius Malombe, formed the task force to assess his government's assets, among them Kicotec.
The report by the Stephen Wambua-led committee said, despite Kicotec having the prospects of generating good revenues for the county government, an apparent lack of proper management had left it tottering on the verge of collapse.
While presenting his the report to Governor Malombe last week, Wambua said the apparel factory was already shut and workers sent home after electricity power was disconnected.
Out of the Sh614 million that Kicotec had raked in as revenue, most of it had been used in not very clear ways, leaving only a balance of Sh440,000.
The report further said despite having a Sh440,000 balance in bank accounts, Kicotec was in late February shut and workers sent home since they factory was unable to pay an electricity bill of Sh100,000.
Wambua’s team, however, said the textile firm had the prospects of turning around the fortunes of Kitui with the kind of revenue it generated.
The report said items were purchased at seemingly very inflated cost at Kicotec, citing the purchase of a mosquito net making machine that had never been put to use but was procured at a cost of Sh29,498,000.
“I doubt whether the machine is giving value for money used to purchase it. We are not sure whether this is the actual cost of that machine,” Wambua said as he presented the report to Malombe.
The task force chairman also added that 100 computerised sewing machines were purchased at a cost Sh9.5 million that seemed very high considering market cost of such sewing machines.
Wambua said there was a curious payment of Sh500,000 for branded cartons while Kicotec had own branding machine meaning it does not outsource the service.
“We do not understand why Sh500, 000 could be used for branding cartons when it could be done there [at Kicotec]," he said.
Wambua said, although the national government supplied special clothing material for making of chiefs’over coats to Kicotec, the factory spent more than Sh875,000 purporting to purchase the same material for the chief’s outfits.
