Mumias Sugar Company losses have doubled from Ksh 1.6 billion in 2015 to Ksh 2.9 billion in 2016 in its unaudited Financial Year results ended December 2016.
The company recorded a net revenue of Ksh 1.529 billion down from Ksh 2.997 billion, a decline of 49 percent over the previous year.
The poor performance has been attributed to shortage of raw materials (cane) and factory underutilisation resulting into high unit costs of production.
“The cane shortage experienced over the period saw the factor operating below capacity hence high cost of production,” read the statement.
“The company envisages cane shortage running through the second half of the year,” it adds.
However, to mitigate that, it plans an accelerated cane development with the core focus being on increasing land under the company control.
“The company is cautiously optimistic that it mid to long term future will improve.”
During the reporting period, it crushed 319,746 tonnes of cane, which is 45% lower compared to 581,541 tons crushed in the same period in 2015. Sugar produced was 12,197 tons, a decline of more than 67% compared to 36,510 tons produced in HY 2015.
Revenue from Ethanol increased 4% to Sh 453 Million vs Sh 435 Million in HY 2015. Over this accounting period, Ethanol prices increased from Sh91 to Sh 95 currently.