COMMENTS ON THE RESULTS
The results for the year ended 30th September, 2015 indicate an increase in profitability in operating activities following the interventions implemented after a review of business in the first half and restructuring of non-performing assets. Significant contributions to this improvement arose from The results for the half-year period ended 31st March, 2015 indicate a decrease in profitability restructuring of non-performing assets. The year closed with a profit after tax arising from operating million in the same period in the previous year. previous year.The year was characterised by a biting drought that severely affected the operations of the company in the first half of the financial year of the company which continued into the third quarter. The The year under review has been characterised by a biting drought that severely affected the production volumes in both tea and coffee divisions dropped considerably.
However, the improvement in the tea prices in the second half supported by a change in manufacture strategy in tea production and stringent control on operation costs contributed to the recovery in profitability. The coffee price however dipped in the second half due to the lower quality of the coffee produced after the drought. During the year, the restructuring of non-performing assets reported in the last financial year, which include the sale of part the land in two of the subsidiary companies, was completed. These parcels of land had been persistently loss making for the last six years running.
The successful disposal of these assets in the second half yielded considerable contribution to the bottom line. During the year, our factories produced 8,578 Tons of made tea compared to 11,564 Tons in the previous year. The average price realize for tea marginal increased to USD 1.87/kg compared to USD 1.82/kg in the previous year. Our estates produced 993 Tons of coffee compared to 1,153 Tons in the previous year. The drop in production is attributed to the rainfall during the first part of the year. The average price realized for coffee dropped to USD 4.55/kg compared to USD 4.82/kg in the previous year; in the previous year the elevated price was due to the poor performance of the Brazilian coffee in the world market.
In view of the increased profitability, the Board recommends the payment of a final dividend of K.shs. 0.25 (25%) per share for the year ended 30th September 2015, payable less withholding tax, where applicable, on or about 18th March 2016, to the members on the register at close of business on 25th February 2016. The register will be closed one day, on February 2016.
Annual General Meeting
The annual general meeting of the members will be held at Kamundu Estate, Kiambu on Friday, 4th March 2016. Formal notice of the meeting to follow. Additionally, the notice and the published Annual Report AN Financial Statements 2015 will also be posted on the Company’s website www.sasini.co.ke in January 2016