After making a loss of more than two billion Kenya shilling in the last financial year, Western Kenya leading sugar miller Mumias sugar is now seeking another two billion Kenya shillings bailout to enable it stand on its fit once again.
The sugar miller made a loss of 2.26 billion shillings los before tax for the last six months up to December last year, a loss that nine percent higher from the previous year where it recorded a loss of 2.08 billion.
The company’s depressing situation for the last three years has contributed to it seeking a 2.2 billion bailout as the management embarks on reforming its working system.
The seek for the 2.2 billion bailout comes six months after the company received 1 billion shillings from the government.
The company had recorded a 6.3 billion loss for the 2014/2015 financial year as the company’s six month operation costs nearly doubled from 378.7 million in 2014 to 732 million shillings.
Despite the despondent situation, the company recorded 11percent increase in the quantity of sugar sold.
For a period six month that the loss is recorded, the company sold 36,333 tones of sugar compared to 32,658 in the previous year.
Dan Ameyo, who is the company chairman cited factory inefficiencies as one of the big contributors to the loss recorded.
Other factors contributing to the company loss included high costs of production and low sugar production among other.
Investment Analyst says the miller will struggle to raise the funds needed for full recovery basing on the increased losses by the miller.
This indicates that the turnaround strategy is not being realized despite assurance from the board that it is stilling working on streamlining its personnel to remain with fresh and resourceful workforce.
