Limuru Tea issues profit warning on high costs, lower valuation of bushes

Limuru Tea Company has issued a profit warning for the year ended December, becoming the latest publicly traded firm to issue a lower earnings alert.

“The … company is expected to record a decline of more than 25 per cent in the net profits attributable to the shareholders of the company for the financial year ended December 31, 2016 as compared with that for the same period ending December 31, 2015,” Limuru said in a statement.

This means the company is expecting a maximum net profit of Sh2.2 million in the period compared to Sh3 million the year before.

Limuru’s expectation of lower earnings is driven by higher costs and lower valuation of its tea bushes.

Other listed firms that have issued profit warnings include human and animal feeds manufacturer Unga Group and Nairobi Securities Exchange.

A similar guidance was issued by Sanlam Kenya which later retracted it after reviewing its liabilities.

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