Agricultural listed firm Limuru Tea expects to sink deeper into losses by at least 25 percent for the full year ended December 2025, citing rise in wages and decrease in market prices.
In a profit warning issued to shareholders on Friday, the firm said lower global demand for tea amidst high supply in the Kenyan market had resulted in lower tea auction prices which is likely to impact its revenues.
Limuru Tea reported a net loss of Sh15.2 million for the year ended December 2024, indicating it expects its post-tax losses to reach Sh19 million. Limuru Tea had already reported a net loss of Sh22.2 million in the half year to June 2025, triple the Sh6.7 million loss reported in a similar period in 2024.
“The board is of the view that the estimated decline in the financial performance of the company for the period is mainly due to high operational costs driven by rising labour costs as a result of higher wages and adverse market conditions where Kenya’s tea auction prices, as reflected at the Mombasa tea auction declined between 2024 and 2025 due to an overall reduction in the global demand compared to elevated stock levels in the Kenyan market,” the company said.
The average tea auction price for 2025 stood at Sh277 per kilogramme down from Sh295 per kilogramme in 2024, as per the Kenya National Bureau of Statistics.
The decline in prices resulted in export earnings from Kenya's tea declining one per cent to Sh186.9 billion despite a four percent increase in volumes. The country's tea exports increased to 652.8 thousand metric tonnes in 2025, up from 625.6 thousand metric tonnes in 2024.
Limuru Tea’s wage cost stood at Sh125.1 million for the year ended 2024 which was a 16 percent increase from the previous year’s Sh107.8 million. The agricultural firm had 418 employees.
The profit warning signals a continued dividend drought for shareholders of the agricultural firm who last received a payout in 2023 of Sh1 per share. The share price is trading at Sh550 per share being a 71.15 percent gain in the last six months making it one of the top gainers at the bourse.
Limuru Tea joins a growing list of listed companies that have issued profit warnings signaling a difficult economic period.
Companies that have issued profit warnings include CIC Insurance, Kenya Airways, Standard Chartered Bank of Kenya, recently listed packaging materials manufacturer Shri Krishana Overseas Limited (SKL), and TPS Eastern Africa which manages Serena Hotels.
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