Sameer issues profit warning to shareholders
Tyre manufacturer, Sameer Africa’s net profit will dip to less than Sh54 million on global disruptions in supply chain logistics.
The slump has prompted the company to issue a profit warning to its shareholders in accordance with the Capital Markets regulations.
“Based on the current unaudited financial results, the board of directors of the company formed the view that, the company’s financial results for the year ending 31st December 2022 are expected to be lower than 25 per cent of the earnings reported after tax for the same period in 2021,” Sameer said in a statement.
The firm’s net profit for the financial period ended December 31 2021 had spiked five times to Sh217.3 million as compared to Sh43.3 million that was recorded in 2020. According to the firm, global disruptions in supply as a result of the Covid-19 pandemic and the Eastern Europe conflict continues to impact availability of key products in the tyre business.
Company Secretary Mercy Mbijiwe said the weakening of the Kenya shilling also impacted on the margins adversely as the full effect of the price changes cannot be passed over to consumers.
By yesterday, the Kenya shilling had slid by a record 5.7 per cent to Sh119.68 against the greenback since the year began, with supply drying up ahead of today’s polls and pressure from rising demand for key imports.
“This profit warning announcement is only based on management accounts of the company and a preliminary assessment made by the board with reference to figures and information currently available,” said Mbijiwe, while advising shareholders and the public to exercise caution when dealing with the shares of the company.