One of Kenya’s listed coffee grower and trader Eaagads has registered a Sh20 million (USD 200,000) loss after tax thanks to prolonged drought in the East African nation.
The loss signifies the nature of coffee business in Kenya, regarded as the best grower of top-notch and high quality Arabica coffee which is used to blend coffee from other countries that grow Robusta.
The company recorded an after-tax loss of Sh20.5 million compared to Sh7.6 million recorded during the same period in 2016 – a deterioration by 170 per cent.
Eaagads’ board of directors while announcing the un-audited results for the six-month ending September 30, said due to the turbulence in the international coffee prices, there was a significant decrease in coffee sales revenues due to lower volumes and a decrease in the market prices in the period.
“This [higher loss] is principally due to the prolonged dry weather, which has resulted in reduced crop and increased the coffee upkeep cost (irrigation, fungicides and inorganic materials),” said the company in a statement filed with the Nairobi Securities Exchange.
The Ruiru-based firm, which was incorporated in 1946 and is currently a subsidiary of Kofinaf Company, engages in growing and selling coffee.
The firm’s board did not recommend payment of an interim dividend for the period under review.
As at March 31, the firm had made an after tax profit of Sh18.1 million compared to a profit of Sh0.5 million in the previous financial year.