Sameer Africa net loss for the year ended December 2019 has almost doubled to Ksh1.062 billion as compared to a loss of Ksh529 million recorded in 2018.
The Group’s revenue reduced by 15 percent from Ksh2.07 billion in 2018 to Ksh1.76 billion in 2019 following the closure of several retail outlets in Kenya and the East African region.
The working capital of the firm is now on the negative at Ksh134 million.
The management says that the loss for the year significantly increased from the loss reported for the year 2018 following the decision to exit from the tyre business leading to the impairment of the tyre business assets and accrual of staff redundancy costs.
Read: Sameer Africa To Sack 73 Employees As Firm Closes Down Tyre Business
However, most insiders have attributed the fall of Sameer Africa to mismanagement.
The earnings for the year lower by more than 25 percent of the earnings reported for the same period in 2018.
Total equities for the year ended December 2019 reduced to Ksh69 million as compared to Ksh1.13 billion a year earlier.
Following the decision to exit from the tyre business, Group revenues are forecast to reduce by Ksh1.49 billion in 2020.
“However, the profitability of the Group is expected to increase due to the elimination of losses that were generated by the tyre business,” says Edgar Imbamba, the company secretary.
In May, the company sacked at least 73 employees as it shut down completely the tyre business.
Read: Sameer Africa External Auditor KPMG Resigns As Company is Accused of Dirty Deals With Gov’t
This is after the company directors resolved on April 20, to close down the tyre business. All the affected employees are engaged in various tyre distribution locations.
Other 52 employees had been sacked in January, as the firm cited harsh economic conditions in the country.
The company has continued to struggle even after its change of strategy in 2016 when it stopped local manufacturing of its key tyre brand Yana and opted to outsource to Asia.
Sameer’s number of staff has been declining in the recent years. The headcount dropped by 120 from 288 staff in 2017 to 168 at the end of 2018.
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