Carbacid Investments, the leading supplier of pure natural carbon dioxide gas in East Africa, has issued a profit warning to its investors. The company joins the growing list of listed firms expecting a profit decline in the current financial year. Six companies have given profit alerts since the year began.
A statement written by the firm’s Secretary stated, “Based on the company’s unaudited financial results for the first six months ended 31st January 2019, and the company’s second-half forecast….profit for the full year is projected to be at least 25 percent lower than the previous financial year.”
The company’s half-year after-tax profit dropped from KSh165 million to KSh105 million equivalent to a 36 percent decline. Although its revenues grew by 1 percent to reach KSh305 million, Carbacid’s profit declined due to the high cost of sales and administrative expenses. Both expenses moved up 7 percent and 22 percent to reach KSh142 million and KSh60 million respectively.
Carbacid blamed the high operating expenses on mining royalties and county government demands.
The gas supplier also suffered a drop in the value of its investments of KSh48 million from the revaluation of its equity investments. Carbacid said that it does not expect to recover from the equity investments loss before the year end on 31st July 2019 hence the anticipated decline in
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