Kakuzi PLC has issued a profit warning to its shareholders for the financial year ending December 31, 20231.
This warning is in line with the Capital Markets Authority regulations for publicly listed companies.
The group currently forecasts that net earnings for the financial year 2023 may be at least 25% lower than those of the financial year 2022.
Kakuzi’s anticipated drop in full-year net earnings is mainly attributed to their Macadamia business.
The Macadamia business is expected to post a loss due to a significant decline in demand and price in the global markets of China, Japan, and the USA.
However, it’s not all gloomy for Kakuzi PLC. Other crops are performing as per expectations with a strong performance expected from Avocado. This diversification could potentially offset some of the losses from the Macadamia business.
In 2022, Kakuzi PLC reported sales of Ksh.4.4 billion, which was a significant increase compared to Ksh.3.2 billion in 2021. The net income for the year was Ksh.845.8 million, a substantial growth compared to Ksh. 319.74 million a year ago.
The same year, the company issued a 25% profit warning on lower production and export of the avocado of the ‘Hass varieties’.
While Kakuzi PLC faces challenges in the Macadamia business, the strong performance of other crops like Avocado provides some optimism.
The financial results of 2022 also indicate a solid financial position, which could provide a cushion against the anticipated drop in earnings for 2023.
