Mumias share drops to 52-week low as miller’s woes rise

The Mumias Sugar share dropped to its lowest level in a year on Tuesday as the miller’s challenges dampen investor confidence.

Its share price closed at Sh1.80 at the Nairobi Securities Exchange, setting a new low for the miller that has lost half of its value since September last year.

“Mumias Sugar touched a 52-week low of Sh1.80 as the miller’s plant remains closed on account of inadequate cane as well as maintenance,” said Standard Investment Bank in a statement.

The company last week ceased operations, starting a 45-day shutdown that it partly attributed to its regular annual closure for maintenance.

It has also faced cane shortages at a time when rival millers in western Kenya are fighting to secure supplies through alleged cane poaching.

The challenges have hurt Mumias’ production, with its brand of sugar missing in major retail stores in recent weeks. Mumias has been operating at 70 per cent of its daily cane crushing capacity of 8,000 tonnes.

The company’s losses increased 63 per cent in the year ended June on the back of higher costs.

It made a net loss of Sh2.7 billion in the period, worsening the previous year’s Sh1.6 billion. Mumias did not declare a dividend.

The performance came as cost of sales rose 17.6 per cent to Sh12.2 billion, surpassing a 9.3 per cent growth in sales to Sh13 billion.