Troubled Mumias Sugar Company (MSC) is unable to complete its financial report for last year due to cash constraints and has been granted a one-month extension by the regulator.
In a notice in the dailies, the listed sugar miller said it did not have the cash to conclude the audit and needed more time to handle material matters.
“CMA (Capital Markets Authority) reporting deadline extension request has been caused by operational matters due to the well known financial challenges currently facing the company, leading to a delay in finalisation of our year-end accounts audits,” said acting Chief Executive Patrick Chebosi.
The counter traded 226,900 shares at the Nairobi Securities Exchange yesterday, opening at 75 cents but falling to 65 cents following the news.
Market share
MSC, which once produced more than half of Kenya’s sugar, had a market share of 1.3 per cent last year, a steep drop compared to its performance less than five years ago when it produced 47,320 tonnes in the year to June 2013.
The quantity of cane crushed and sugar produced was down 70 per cent, mainly due to cane shortage as farmers deserted cane farming.
Farmers currently contracted to the company are yet to receive payment for cane deliveries and are owed over Sh900 million, according to the management.
Last month, President Uhuru Kenyatta directed that cane farmers be paid Sh2.6 billion owed to them by sugar factories in western Kenya within one month.
He also challenged a taskforce looking into sugar issues under Agriculture Cabinet Secretary Mwangi Kiunjuri and Governor Wycliffe Oparanya to move swiftly and present a workable turnaround strategy of the ailing sugar millers before the Government can inject funds into them.
Accountable
The Head of State also vowed to ensure individuals who looted billions in the sugar industry are held accountable.
Elsewhere, Nzoia Sugar Company has started processing names of farmers who made deliveries to the factory so that they can be paid their dues.
The management has called on farmers to activate their bank accounts while those without have been advised to open them immediately and forward the details to the firm.
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