The Kenya Tea Development Agency (Holdings) Limited has declared a dividend pay out of Sh734 million for its tea farmers for the year ended June 2020.
This is a 15 percent increase from the Sh683 million KTDA declared as dividend the previous year. The agency has attributed the spike to enhanced green leaf production, which was also responsible for growth in revenues.
KTDA also noted that its move to establish subsidiary businesses had contributed immensely to the improved performance.
“Group revenues grew last year, driven mainly by increased tea sales volumes. Increased tea production led to high stocks at the peak of Covid-19 and exerted considerable pressure on working capital within the Group.
“Increased tea production led to high stocks at the peak of Covid-19 and exerted considerable pressure on working capital within the group,” he said in a statement. “The board has proposed a dividend of Sh734 million compared to last year’s Sh683 million, a welcome performance in a difficult year.”
He said the firm is addressing the cost of production to enhance the farmers’ earnings.
KTDA Holdings Group Chief Executive Lerionka Tiampati said the average cost of production had declined by 6.6 per cent on the back of effective cost-containment measures.
“The average cost of production reduced by 6.6 per cent from Sh88.98 to Sh83.09 per kilo, mainly driven by higher cost absorption from higher volumes and cost containment measures instituted,” he said.
Tiampati noted that focus will be placed on staff welfare, training and development, and prudent financial management of each firm. Tea farmers under KTDA delivered 1.45 billion kgs of green leaf for the period under review, up from 1.13 billion kgs the previous year
This translates to Sh79.0 billion in revenue from Sh69.8 billion last year.
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