Listed food processor Unga Group anticipates to record a loss for the year ending June 2023, reversing a Sh311 million profit reported the previous year.
The firm cited increased production costs triggered by a scarcity of locally sourced raw materials, which forced it to turn to imports at high global prices.
“Based on the company’s unaudited financial results for 11 months and the June 2023 forecast, results for the full year will be a loss, compared to a profit in the prior year,” the company said in a notice on Friday.
Unga says the tough business environment has been worsened by the weakening shilling and shortage of American dollars, which have led to high forex losses and increased interest expenses.
“Scarcity of locally sourced raw materials led to increased importation at higher global prices. This led to increased production costs which could not be fully passed to the consumers.”
The Nairobi Securities Exchange-listed miller posted a net loss of Sh131.3 million for the six months to December 2022.
The firm becomes the third listed entity to issue a profit drop warning in recent times after Longhorn Publishers and State-owned utility firm Kenya Power.
