Eveready East Africa’s chairperson Lucy Waithaka and two other directors have resigned from the batteries distributor amid widening losses.
Mrs Waithaka, Fauzia Shah and Akif Hamid Butt stepped down on Wednesday ahead of the company’s announcement of a larger loss in the six months to March and the entry of a new strategic investor who was not named.
The Nairobi Securities Exchange-listed firm communicated the exit of the trio to the Capital Markets Authority in a correspondence seen by Business Daily.
Ms Waithaka was an independent non-executive director and also the board chair. She was appointed in 2013 following the retirement of former Vice President Moody Awori, after a five-year stint.
Mr Butt who was representing the interest of Eveready’s top shareholder Sameer Group was a non-executive director.
Ms Shah, who has also worked for Sameer Group as a company secretary and in-house counsel was a non-executive director of the batteries distributor.
In a separate publication, Eveready disclosed a larger loss of Sh17.7 million in the review period compared to Sh8.4 million a year earlier. The performance was due to sales falling to Sh10.5 million from Sh41.6 million.
A new strategic investor is expected to help Eveready, which has been making losses for years, turn around its dwindling fortunes.
“The company now has a new strategic investor who will put in place measures to improve the company’s financial performance while leveraging on the strong household brand and long-term heritage,” the company said.
The investor will leverage its networks to assist Eveready in rolling out a turnaround strategy and support its future growth.
The investor is also expected to strengthen Eveready’s capacity to fund investments required to support its future growth.
Further, it will aid in the “diversification of the company’s product lines including oil and gas sectors so as to improve the financial stability while maximising the shareholders’ value going forward.”
Eveready has been in financial distress in recent years due to a shift in customer preference from dry cell batteries, which it used to manufacture locally at the Nakuru factory and which it closed in 2014.
The company also pulled out of a distributorship agreement with American battery maker Energizer in 2016, accusing the firm of taking control over product distribution and company margins.
Eveready now focuses on the Turbo brand of batteries and its sales have been dwindling steadily, resulting in losses which have wiped out shareholder funds.
The company reported a negative book value of Sh62.2 million in the six months to March, widening from Sh44.5 million the year before.
Its share price, which traded at highs of Sh17 in 2016, has collapsed to below Sh1 to join other beleaguered firms such as Uchumi Supermarkets and Mumias Sugar Company.
