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Coffee company, EAAGADS has issued a profit warning saying that earnings for the current financial year will be lower by 25 per cent on lower coffee volumes offered to the auction. This the company said in a statement was as a result of lower production levels and lower quality beans which negatively impacted the commodity’s prices.
“This was solely attributable to the severe drought experienced in Kenya in late 2016 and early 2017. In addition coffee prices were affected by the New York Coffee Exchange market price, which principally determines the price of coffee,” the firm said.
As a result of the aforementioned factors, the Nairobi Securities Exchange (NSE) listed company saw a dip in its sales revenues to Sh56.5million as well as other upkeep costs which went up by Sh45.5million.
More than 76 percent of Eaagads coffee was sold through the auction during the financial year.