Listed tea and coffee grower and processor Sasini #ticker:SASN has reported a 61 per cent fall in net profit for the six months ending March 2017 on lower revenue from cash crop sales.
Sasini’s net earnings for the half year period stood at Sh77.3 million, compared to Sh197.5 million in the six months to March 2016.
Total revenue shrunk by Sh134 million to Sh1.45 billion, while the fair value losses on biological assets rose to Sh44 million from Sh10 million in 2016.
Sasini had not responded to the Business Daily’s queries on the results by the time of going to press. Plantation firms were hit by the recent drought, which lowered production, especially that of tea.
The Agriculture and Food Authority (AFA) said earlier this month that Kenya’s tea production in the first quarter of this year fell by 35 per cent compared to the same period last year.
“Tea production for the first three months of the year 2017 was significantly lower at 90.09 million kilos against 139.6 million kilos recorded during the corresponding period of 2016.
‘‘This was attributed to the dry and hot weather conditions and delayed onset of the long-rains season,” said AFA in its latest quarterly bulletin. The lower production is, however, likely to spur a rally in the price of the commodity, which could see the firm recoup some of losses.
Sasini’s earnings in 2015 and 2016 had benefitted from asset sales, which brought in Sh422.7 million in the year ending September 2016, and Sh830.7 million in 2015.
The firm recently sold 513 acres of land in its two coffee estates in Nyeri, and had earlier in 2015 sold a building on Nairobi’s Loita Stree for more than Sh600 million.
In February, the firm announced it will sell off its restaurant chain, Sasini Coffee House, for Sh70 million.