NAIROBI, KENYA: Limuru Tea profits for 2020 will go down significantly compared to the previous year.
In a warning statement to shareholders and public, the company’s Board attributes the drop to lower market prices realized in 2020 compared to 2019 due to rising cost of production and the prevailing global downturn on account of Covid-19.
“Based on preliminary reports, we are staring at a decline in performance in the net profits, Boar is of the view that the drop is due to lower tea markets and effects of Covid-19 on global economies,” said Alison Kariuki, Company Secretary.
The announcement is based on information statements of the company available to the Board and preliminary evaluation of the financial statements of the company for 12 months currently before the company’s auditors.
Details of the company’s financial results will be published by mid-March.
The tea firm joins a growing list of companies that have issued a profit warning for the 2020 financial year.
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It joins Absa and Standard Chartered banks that have issued profit warnings for the year in the wake of growing bad debts and rescheduled loans arising from the effects of the Covid-19 pandemic.
In November last year, KCB also announced a 43 per cent drop in profit after tax in the nine months ended September due to increased provisions on bad loans.