Kakuzi bets on product diversity for growth

Laura Xu (left), Chris Flowers and Simon Odhiambo (right) at the Kakuzi Avocado Orchards in Makuyu, Murang'a County. [File, Standard]

Listed agricultural firm Kakuzi will maintain a products and markets diversity strategy geared at enhancing shareholder returns.

As part of the shareholder returns enhancement strategy, Kakuzi is gearing up to make its pioneer property development investment in the retail sector as it develops Kakuzi Farmers Market.

The retail enterprise, to be located opposite the firm's headquarters on the Nairobi-Nyeri highway, will allow Kakuzi to sell its recently introduced range of value-added products and provide a decent place for up-country travelers to stop and refresh.

Kakuzi is also in the final stages of a commercial appraisal process for a full-scale blueberry production venture at a Sh4 billion estimated cost.

Speaking when they addressed the firm's shareholders at the 95th Annual General Meeting, Kakuzi Chairman Mr Nick Ng'ang'a and Managing Director Chris Flowers assured that the superfoods grower is actively focusing on enhanced revenue generation from diversified local and export market produce.

The firm is also set to commission a Macadamia Oil Extraction Plant to meet the growing demand for value-added products within its superfoods portfolio. Domestic sales of value-added macadamia products will also help mitigate challenges in the international arena due to a prevailing macadamia glut in the global market.

"We believe that the diversity of products, markets and routes to market are essential elements of Kakuzi's business strategy. Having the combination of avocados, macadamias, and hopefully blueberry as export crops to America, Japan, Europe, China, the Middle East and the UK, as well as a strong domestic value addition range, we believe, gives us the greatest opportunities to minimize risk and maximize returns in these difficult international market conditions," Kakuzi Managing Director Mr Flowers said.

In the last financial year, Kakuzi posted a Sh845.8 million net profit for the financial year ended December 2022, representing a 62 per cent after-tax profit growth. The leading Avocado and Macadamia grower and exporter attained a historical record growth against its pretax profit, which closed at Sh1.22 billion, a 159 per cent increase, up from the Sh472 million posted the previous year.

The earnings were underpinned by a total sales revenue jump amounting to Sh4.4 billion, up from Sh3.2 billion posted the previous year, and boosted by additional sales for forestry, livestock, and blueberry produce in the local market.

Kakuzi shareholders will enjoy a Sh24 dividend payout, as earlier recommended by the Board and approved at the meeting yesterday, up from the Sh22 payout the previous year.