Unga Group net profit halved for the six months period ending December 31, 2019 compared to a similar period in 2018.
Unga Group registered a profit of Sh151 million in the period, down from Sh306 million in 2018.
This drop was attributed to reduced volumes in the animal nutrition segment and increased cost of wheat and maize grains. The low production and inflated costs were caused by unfavourable weather conditions in the year.
In 2019, rains came late in the year, in volumes that left a trail of destruction. Unga Group’s profit before tax grossed Sh219 million, down from Sh437 million in 2018.
Revenue, however, increased by 11 per cent, from Sh9 to Sh10 billion, helped by the human nutrition business.
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Unga feels that the main challenges that affected the industry in 2019 might persist.
"The continued low consumer demand, coupled with excess production capacity, aggressive finished product pricing across the industry and restricted maize grain supply will remain a challenge. The board and management will continue to work on strategies to deliver improved performance," read the report.
