This means that investors in the company cannot make meaningful decisions based on its disclosures, making it one of the most speculative stocks trading on the Nairobi Securities Exchange (NSE).
RSM says it is yet to confirm Mumias’ turnaround plans, with the company’s woes deepening in the year ended June 2018 when it made a Sh15.1 billion net loss and its net assets turned to negative Sh14.3 billion.
Its lenders include French investment fund Proparco, Commercial Bank of Africa (CBA), Kenya Commercial Bank (KCB) and the National Treasury.
Mumias says it is asking the lenders to restructure their loans, adding that the government is also on course to provide additional bailout funds.
Loss-making Mumias Sugar Company’s #ticker:MSC external auditor RSM Eastern Africa has disowned the miller’s financial statements for the year ended June 2018, citing lack of evidence to back the board’s claims of a rescue plan.
This means that investors in the company cannot make meaningful decisions based on its disclosures, making it one of the most speculative stocks trading on the Nairobi Securities Exchange (NSE).
RSM says it is yet to confirm Mumias’ turnaround plans, with the company’s woes deepening in the year ended June 2018 when it made a Sh15.1 billion net loss and its net assets turned to negative Sh14.3 billion.
“We do not express an opinion on the accompanying financial statements of the company,” RSM said in its report.
“By the time of concluding the audit, we had not obtained sufficient appropriate evidence that any of the initiatives by the directors to obtain the financial support, that would enable the company to meet its future obligations as they fall due, had been concluded.”
The board of Mumias told shareholders that the miller will be able to continue operating despite its myriad challenges and delays in raising substantial new capital that will help it resume production of sugar and other products on a commercial scale. The company, which has defaulted on its loans, saw its borrowings rise to Sh12.5 billion in the review period compared to Sh11.6 billion a year earlier.
“Although the lenders have not taken further action for recovery of the loans, some have charged the company penalty and interest,” Mumias said without disclosing the penalties levied.
Its lenders include French investment fund Proparco, Commercial Bank of Africa (CBA), Kenya Commercial Bank (KCB) and the National Treasury.
Mumias says it is asking the lenders to restructure their loans, adding that the government is also on course to provide additional bailout funds.
“The Government of Kenya has set aside Sh2.6 billion to settle cane farmer arrears with Sh0.7 billion of the Sh0.9 billion allocated to Mumias already paid out to Mumias Sugar farmers,” the company said.
Ahead of the turnaround plans, the miller has decided to lease out its estate farms, stadium, schools, housing estates, water bottling plant and welfare facilities. It is also set to fire more staff.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
