Here is a List of Companies That Have Issued Profit Warnings in 2018

Kenyan politicians continue to insist that the country’s economy is sound and set to grow at tremendous rates than ever before but the stats on the ground continue to prove them wrong.

Thousands of Small Medium Enterprises (SMEs) are closing down due to heavy taxes, inadequate information, and inaccessibility to markets as well as inadequate funding in terms of loans from financial institutions.

Just this year alone, several notable companies have been placed under administration with the latest being Midland, ARM and the Deacons.

READ: Deacons Plc Suspended at the NSE as it Goes Under Administration

What is worrying many is, however, not the number of companies going under administration but the number of companies issuing profit warnings ahead of the release of the financial results. Here are some of the companies that have already indicated that they will either run into losses or register a significant drop in profits:

• Bamburi Cement

This was the latest to issue a profit warning. According to the management, the profits might drop by 67 percent, the highest drop in more than 10 years. The company has attributed its woes to the cost of doing business in Kenya and Uganda due to high energy prices.

• Deacons

Deacons has been placed under administration. The company has been going through a financial turmoil and has blamed its financial woes to the collapse of Nakumatt and Uchumi Supermarkets through the closure of most of their outlets.

• HF Group

With the real estate sector giving good returns and with most of the commercial banks registering immense profits, one would expect HF Group to follow suit but that might not be the case following a profit warning from the management.

The Group says that reduction of the CBR by the MPC led to the Group reducing lending rates during the year, negatively impacting on their earning.

• Kenya Power

A company that shocked many when it issued a profit warning was Kenya Power. Kenya Power is the only supplier of electricity in Kenya. The company sets its own prices and has no competition but still, it issued a profit warning. Reasons? Poor hydrological conditions and the government’s appetite to connect more Kenyans to the grid that left the company with a 3 billion shilling hole to fill.

Other companies that have issued profit warnings include Sanlam and Sameer Africa.