BOC Kenya PLC has announced a profit warning pursuant to the Capital markets (Securities). (Public offers. Listings and Disclosures) Regulations, 2002.
The statement is attached below:
The Board of Directors of the Company projects that the Company’s Net Earnings for the current financial year ending on 31 December 2019 may be at least 25% lower than the level of earnings in the previous financial year, 2018, primarily due to the following factors:
- Depressed demand for gases from the industrial sector, mostly Small and Medium Fnterprises, due to the prevailing economic environment.
- Supply to several public sector customers with invoices that have remained unpaid for periods significantly above the allowed credit period. These overdue amounts have also led to additional doubtful debt provisions.
- High local energy costs impacting production costs.
- Outage of a key raw material due to constraints on the part of a key overseas supplier together with unanticipated down time of the gas production plant to undertake emergency repairs. These issues have now been resolved.
Measures continue to be taken to safeguard shareholder value by seeking new revenue streams and ensuring operations reflect a high level of efficiency and productivity as it remains true to its reputation for safety and high-quality products across the Company’s portfolio.
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