Longhorn Publishers has issued a profit warning for the year ended June 2023, citing rising costs of paper, currency depreciation and shrinkage of consumer wallets.
The firm anticipates its net profit for the period to drop by at least a quarter, meaning that it will not surpass the Sh39.9 million earnings for the year to June 2022.
“The underlying reasons for this decline in performance are rising costs, including cost of paper which has increased by over 75 percent in the last 12 months, currency depreciation, lifting of the interest rate restrictions in the second half of the financial year, shrinkage of consumer wallets arising from the rising cost of living and general slowdown in business during election period,” the company said in a statement.
The Nairobi Securities Exchange-listed publisher has posted a net loss of Sh98.3 million for the first six months ending December 2022.
Longhorn operates in nine markets — Kenya, Uganda, Tanzania, Rwanda, Zambia, Malawi, the Democratic Republic of Congo, Cameroon and Ghana.
The firm says it is reviewing its business model across the markets and will make the “necessary changes” to realise efficiency.
“These initiatives include exiting markets with low economic prospects.”
