2020, the year of the Coronavirus has seen atleast 14 of Kenya’s biggest companies issue profit warnings with all of them citing the economic shortfall due to the Covid-19 pandemic.
Britam Holdings Company secretary Nancy Kiruki announced the company wold rake in less profits in 2020 than in 2019 ”based on a preliminary assessment of the forecasted financial results of the Company for the period ending 31 December 2020, the earnings of the Company for the current financial year are expected to be substantially lower compared to the earnings reported for the same period in 2019.”
Absa Bank Kenya Plc, formerly Barclays Bank Kenya Limited also issued a profit warning saying its net profit for the 2020 full year is expected to decline significantly mainly triggered by the impact of coronavirus. “Trends and forecasts show that the rate of impairment is increasing due to the delayed loan repayments and potential additional stress due to COVID-19 after-effects.” Absa company secretary notified its investors.
East African Breweries Limited (EABL) sent out a profit warning to shareholders as it expects a decline in profit after tax of around 25 pc in the year. “The COVID-19 global pandemic and the subsequent response measures taken across the region have impacted our business negatively,” said Dr Martin Oduor-Otieno, Chairman of the EABL Board of Directors in a statement.
Kenya Power and Lighting Company (KPLC) also sent out a profit warning earlier in the year. “Based on a review of the company’s financial performance, the board of directors has determined that the earnings for the financial year ending June 30, 2020 are projected to be lower than the earnings for the previous year,” the board said in a statement.
East African Cables also makes the list. “While the Group revenues are projected to grow by 10 per cent year-on-year, the impact of Covid-19 on the economy reduced chances for more aggressive top-line growth to match prior year performance,” the firm’s board said in a notice to investors.
Kenya Orchards which manufactures and sells canned fruits and vegetables in October issued a profit warning in the current financial year. The food processor is warning that its net profit in 2020 will be lower by more than 25% of the net profit posted in 2019. “Most of our customers have been affected negatively by COVID19 and therefore overall business is down,” said the company.
For the first time in five years Longhorn Publishers issued a profit warning on account of disrupted learning caused by Covid-19. “The board of directors, having reviewed the group’s performance forecast has determined that the earnings for the financial year ending June 30, 2020 will be lower than the earnings for the previous year,” said the publisher in a statement.
Nairobi Business Ventures, the fashion retailer operating the K-Shoe brand, issued a profit warning earlier in the year. “The board brings to the attention of the public that the earnings for the current financial year are expected to be lower by at least 25% than the earnings reported for the same period in 2018,” the company CEO, Mr Vasu Abotula said.
Nation Media Group chairman Wilfred Kiboro issued a profit warning to NMG investors, citing reduced revenues due to the effects of Covid-19 pandemic.“The Board of Directors, having reviewed the company’s performance forecast for the current trading period, has determined that the earnings for the financial year ending 31 December 2020, will be lower than the earnings for the previous year by at least twenty five percent,” said Kiboro in a statement to shareholders.
Others are NCBA Group , TPS Eastern Africa , I&M Holdings, Standard Chartered Bank Kenya, and Unga Group who have all warned investors of reduced earnings
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