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Williamson Tea posts Sh34m profit

BUSINESS NEWS
By Frankline Sunday | November 26th 2020

Part of the 4,000 power panels installed on a 2.5 acre piece of land at Williamson Tea Company. [File, Standard]

Listed company Williamson Tea has posted Sh33.9 million in profit after tax for the six months ending September 30, 2020.

The firm attributed the earnings to favourable weather conditions which boosted yields.

According to the latest financial earnings report, the company recorded Sh1.9 billion in revenues in the period under review, up from Sh1.3 billion - with operating losses standing at Sh17.6 billion.

“Turnover increased for the six months compared to last year on the back of favourable weather conditions and strong support from our smallholder farmers,” said the company in a statement accompanying the results yesterday.

“Despite record low prices in the market place due to high supply-side and financial uncertainties attributable to the coronavirus pandemic, the group has managed a modest profit through diligent selling, quality controls and prudent cost savings.”

Tea production

Data from a national statistician, the Kenya National Bureau of Statistics (KNBS) indicates tea production in the country registered an increase this year despite the disruption caused by the outbreak of coronavirus.

“Tea production increased by 34.5 per cent from 106,314 tonnes in the second quarter of 2019 to 143,037 tonnes in the period under review,” said KNBS.

However, export challenges and a glut in the international market eroded earnings with many companies in the country posting losses.

The firm also approved the liquidation of its generator sales unit. “Subsequent to these half-year results, the board of directors who had considered and approved the voluntary winding up of the generator sales and service segment of the business initiated the liquidation process,” said Williamson Tea in a statement signed by Company Secretary G K Masaki.

The company, in its financial projection, said the business outlook remained 'very difficult'.

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