Sasini raises dividend by half regardless of 53pc revenue drop

Staff course of macadamia on the Sasini nuts plant in Kiambu. PHOTO | POOL

Agricultural agency Sasini has elevated dividend payout by 50 p.c to Sh342.1 million regardless of the web revenue greater than halving to Sh542.6 million within the monetary yr ended September 2023.

The board introduced Monday it has advisable a remaining dividend of Sh0.50 per share amounting to Sh114.25 million so as to add to the Sh1 per share interim dividend or a complete of Sh228.06 million that had been paid early July final yr.

The ultimate dividend will probably be paid on or about March to traders who will probably be in Sasini’s share register on the shut of enterprise on February 22.

The agency’s prime three shareholders are Legend Investments Restricted (41.84 p.c), Yana Towers Restricted (12.6 p.c) and East Africa Batteries Restricted with an 11.02 p.c stake.

Sasini’s internet revenue retreated from a seven-year excessive of Sh1.17 billion, marking a 53.6 p.c decline within the assessment interval the administration described as “extraordinarily difficult” as a result of adversarial climate situations, particularly within the first half of the yr.

Learn: Sasini posts highest revenue in seven years

“The impact on the enterprise was drastic in all models as manifested in decrease manufacturing volumes, lower cost realisations and better prices of manufacturing,” mentioned the board.

“The extended drought within the first half of the monetary yr resulted in a considerable loss in tea manufacturing that additionally manifested within the avocado and low models adversely impacting manufacturing volumes.”

Income fell by 22 p.c to Sh5.72 billion whereas administration and institution bills from Sh997.7 million to Sh1 billion, reducing the underside line. Finance prices additionally practically doubled to Sh55.65 million from Sh28.25 million.

Sasini mentioned the drop in manufacturing was coupled with a big fall in international espresso costs, the entire collapse of the macadamia market occasioned by recession in the primary market -the US, the delay within the opening of the avocado export season in Kenya as a result of late maturing of fruits, and the inflationary results of doing enterprise.

“On account of the a number of shocks and financial uncertainties aggravated by the results of local weather change, among the enterprise models had been extra adversely affected than others. Solely the tea, avocado, and low buying and selling models had been worthwhile. The espresso estates and the macadamia models recorded unfavourable outcomes,” mentioned the agency.

Tea profitability

Nevertheless, the Nairobi Securities Change-listed agency mentioned the tea enterprise unit achieved the highest-ever registered efficiency over the historical past of the enterprise from working actions regardless of the adversarial climate situations early within the yr.

Sasini mentioned the cumulative results of automation of processes within the fields, manufacturing efficiencies, price management, and enlargement of the out-grower farmer’s catchment areas contributed to the profitability of the tea enterprise.

“Given the lower-than-expected efficiency in the course of the yr, the administration will proceed to hunt and set up strategic partnerships to broaden our attain and discover new strains and concepts in a bid to slot in with the altering enterprise surroundings to broaden and improve shareholder worth,” mentioned the board on the outlook.