Sameer Africa PLC has issued a profit warning for the fiscal year ending 31st December 2023.
Through an announcement by the Board of Directors of the firm, Sameer warned that its profit will dip by at least 25 per cent compared to what it posted in a similar period in 2022.
Sameer has attributed the decline in profit to the depreciation of the Kenya Shilling against major currencies.
“This has seen the company incur substantial foreign exchange losses for the period arising from the translation of foreign-currency-denominated liabilities,” stated Sameer Africa Company Secretary Mercy Mbijiwe.
However, Sameer noted that it is implementing initiatives that will help retire the foreign-currency-denominated liabilities by June 2024.
“This profit warning announcement is only based on management accounts of the company and a preliminary assessment made by the board with reference to the figures and information currently available,” added Mbijiwe.
“The shareholders of Sameer Africa PLC and the public are therefore advised to exercise caution when dealing with the shares of the company,” said Sameer Company Secretary.
Read: WPP Scangroup Issues Profit Warning On Subdued Economic Environment
Several firms listed on the Nairobi Securities Exchange (NSE) have issued profit warnings for the year ending 31st December 2023.
The depreciation of the shilling against the dollar has been one of the reasons the NSE-listed firms have issued the warning in addition to the increase in the cost of doing business and the harsh economic environment in the country.
Other firms that have issued profit warnings include marketing and communication group WPP Scangroup PLC, Crown Paints, Sasini, Nation Media Group and Car & General.
Scangroup profit for the year ending 31st December 20234 will shrink by at least 25 per cent on the subdued economic environment while Crown Paints Kenya has attributed the drop in profits to increased cost of raw materials, increase in transportation costs and volatility in foreign exchange rates.
On the other hand, Sasini PLC’s profit for the financial year ending 31st December 2023 will also drop by at least 25 per cent due to the high cost of production while Car & General’s profit will shrink by more than 25 per cent due to the weakening of the Kenya Shilling against the US dollar.
Late last month, the local currency crossed the 150-unit mark against the dollar, depreciating by more than 17.7 per cent against the greenback since the beginning of the year.
Today, data from the Central Bank of Kenya (CBK) show the local currency is trading at Ksh152.96 (buying) and Ksh153.16 (selling) against the US dollar.
Data from CBK also shows the exchange rate for the Sterling pound and Euro are Ksh193.15 (buying), Ksh193.46 (selling) and Ksh167.56 (buying), Ksh167.83 (selling) respectively.