Skip to content
Stock Watch

Kenya Orchards Releases Half-year Results

BY · September 2, 2015 09:09 am

Kenya Orchards Ltd (NSE: ORCH), released their half-year results for the period ended 30th June 2015, with the following highlights:

  • Kenya Orchards Limited announced a 12% increase in profit after tax; to the tune of KES. 1.65Mn. A healthy top-line growth of 12%-registering revenue at KES. 31Mn- sustained through increased administrative expenses and finance costs; that increased by 327% and 201%, respectively.
  • Kenya Orchard’s ability to meet short term obligations decreased, as an increase in current assets was unable to outweigh an increase in current liabilities; the current ratio dropped from 2.33 to 1.82, a key financial indicator for a small-cap stock.
  • Key financial indicators protend a positive six months for the company, exemplified by a 728% increase in cash generated from operations, to KES. 2Mn. A 145% decrease in trade payables, to KES. 0.8Mn, shows the company’s improvement in meeting obligations; however the 70% increase- to KES. 7Mn- in trade receivables, contributes to a worsening performance. The food processing company faced a 3411% decrease in cash and cash equivalent at the end of the period; thus raising a red flag on potential management decisions and the buffering position of the company, during more adverse market conditions.

Recommendation

The Kenya Orchard stock price managed to surge 20-fold in the previous year due to positive sentiment on plans to diversify and expand; the latter was achieved through completion of a manufacturing plant. The food processing company reaped significant advantages from the previous booming local stock market; as small cap stocks returned annual price gains of over 50% by the beginning of 2015.

We maintain a HOLD recommendation on the counter, which has a demure upside of 6%, to a target price of KES. 106. The recommendation is further illustrated by the financial ratios, as earnings per share increased by 11.72% but book value per share significantly decrease; by 643%.

Trending Stories
Government and Policy Understanding The Revised NTSA Traffic Offenses And Fines: A Guide For Safer Roads Steve Biko Wafula
Government and Policy TSC Releases New Requirements For Deployment Of P1 Teachers To Junior Secondary Getrude Mathayo
Market News Kenya Airways Resumes Trading At The NSE With A Bang, Price Ups 5.7% Standard Investment Bank
Investment Rendeavour Appoints New Board Chairman And Independent Directors Soko Directory Team
Headlines Why Health Insurance Is More Than A Policy—It’s A Promise Soko Directory Team
Related Articles
Market News Kenya Airways Top Gainer At The NSE As Equity Turnover Expands 42% Standard Investment Bank
Market News Bamburi clocks 95% Of Day’s Turnover, Linked To The Takeover Offer Soko Directory Team
Market News November PMI Expands To 50.9, CBK MPC Interest Rate Decision Tomorrow Soko Directory Team
Market News Safaricom Accounts For 66.3% Of Thursday’s Turnover As Foreign Investors Turn Bearish Standard Investment Bank
Investment Why Is The NSE Dead When We Have So Much Opportunity For IPOs And a Sustainable Ecosystem Of Investments? Steve Biko Wafula
Explore Soko Directory
Banking Blogging Commodity Watch Did you know Entertainment Entrepreneur's Corner Feature Government and Policy Headlines Investment Lifestyle Market News Money Opinion Press Releases Stock Watch Technology
Soko Directory Archives