- The cement maker anticipates that its last year’s earnings will sink further into the red by at least 25 per cent.
- Manufacturer blames Tanzania coal ban and disruptive election period in Kenya for declined performance.
- In 2016, the company posted a 2.8 billion loss.
ARM Cement #ticker:ARM is now the latest firm to issue a profit warning for the 2017 financial year, meaning that the NSE-listed company will post a loss of at least Sh3.5 billion.
According to a notice sent Monday, the cement maker anticipates that its last year’s earnings will sink further into the red by at least 25 per cent.
“The Group’s performance has been adversely affected by difficult market conditions and import ban for coal in Tanzania, by the prolonged and disruptive election period in Kenya, as well as a strain on the Group’s working capital. The Board of Directors also anticipates negative year-end provisions for contingencies and impairments of inventories and assets,” said the statement in part.
ARM manufactures the Rhino brand of cement.
In 2016, the company posted a 2.8 billion loss, continuing a trend that saw its profits sharply decline by 294 per cent in 2015 when it recorded Sh2.89 billion loss.
Other firms that have issued profit warnings for 2017 include TransCentury #ticker:ICDC, Britam #ticker:BRIT, Mumias Sugar #ticker:BRIT and Unga Group #ticker:UNGA.
Kenya in January lowered its economic growth outlook - from 5.1 per cent to 4.38 per cent - citing drought and politics.