Mumias Back Into ICU with Ksh 15.1 Billion Loss

By Soko Directory Team / March 13, 2019




The woes facing the troubled Mumias Sugar Company seem to be far from over after the miller registered a loss of 15.1 billion shillings for the year ended June 2018.

The current loss by Mumias Sugar is more than double the 6.8 billion shillings that were registered during the same period in 2017.

Mumias Sugar has been going through financial turbulence, forcing the suspension of its operations with its products missing out of the shelves for almost a year.

According to the miller, the sharp rise in losses was as a result of 101 percent spike on impairment charges to the machinery and the plant from 2.6 billion shillings to 4.9 billion shillings.

The miller says during the year under review, cane delivered dropped by 32 percent from 417,347 tons in 2017 to 283,435 tons in 2018.

The annual turnover, on the hand, declined from 2.09 billion shillings to 1.37 billion shillings. The firm had postponed the announcement of the results for 15 months.

Choking in Debts

Mumias Sugar Company has been moving on the wheels of debts, owing suppliers and workers more than 3 billion shillings.

As at September 2018, the miller owed Kenya Power 2 billion shillings, Kenya Revenue Authority 1 billion shillings and over 700 million shillings in salaries for workers.

The government offered to bail out the miller through the issuance of 2 billion shillings, the amount which the management says was not delivered in full.

The company applied for another 2-billion shilling bailout from the government with an aim of bouncing back to profit-making though economic analysts believe the miller is in the last stages of life.

Sugarcane Poaching

Mumias Sugar has in the past accused private competitors for poaching their cane from farmers leading to cane declines. It accused some millers of buying cane directly from farmers by paying cash, leading to farmers shunning away from Mumias which kept them waiting for payments for long.



About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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