Unga Group Reports drop in FY19 Net Earnings, Cuts Dividend by half.

Unga Group Plc announced their results today before market opened.

The Groups sales revenue declined by 10% over prior year. Profit for the year decreased by 30%. Volumes and margins were under pressure throughout the year due to increased competition. This mainly affected the human nutrition business. The commissioning of a new wheat mill in Eldoret in December 2018 increased capacity and further improved production efficiencies.

The bakery business recorded a significant reduction in losses despite a 16% drop in revenues. The reduction in revenues was mainly attributable to credit risk challenges in the retail sector.

Unga Group had issued a profit warning announcement in March 2019, which the Group attributed to decline in human nutrition business due to increased competition and depressed consumer demand.

The Group hopes for a better results next year as their new soybean meal plant which was commissioned at the Nairobi feed plant at the end of the 2018/19 financial year achieves full operations and is expected to provide raw material price improvements going forward.

The company will pay a first and final dividend of Kes 0.50 per share (drop of 50% against Kes 1.00 paid in 2018), subject to approval by the shareholders at the Annual General Meeting to be held on 5 December 2019.

Books for dividend consideration will close on 6th December, 2019.

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