Unga Group Holdings Ltd is considering shifting from the grain milling business to a general food company after more than 110 years of operations.
Unga group said it is dealing with declining revenues due to increased competition in the milling industry, decreased demand for its products, and high raw material costs.
The regional flour miller, which is listed on the Nairobi Securities Exchange (NSE), revealed in its most recent integrated report that it is preparing to transition into a general food company to secure the company’s future.
“Looking ahead, we have observed changing consumer purchasing habits, particularly among younger consumers who prefer convenient, nutritious foods that are easy to prepare while also being health conscious,” said Joseph Choge, the Group’s managing director.
According to the report, wheat and maize prices rose during the fiscal year that ended June 30 due to a poor harvest, a weakening local currency, and adverse fiscal measures imposed by some exporting countries.
Furthermore, the shilling’s depreciation against the dollar impacted importation costs, resulting in significant forex losses.
Consequently, over the last two years, more than 50 new millers have entered the sector, creating an intensely competitive environment.
“In addition, we continue to be affected by cheap poultry imports from the region and fish from Asia, resulting in condensed market for our animal nutrition products,” reads the report.
