Keneyan supermarket giant Uchumi’s half-year pre-tax loss widens by 288pc. The supermarket recorded a pre tax loss of Sh1 billion. Uchumi posted a Sh262.4 million loss in December 2014. An year after, in December 31, 2015, the supermarket marks a 288 per cent dip in loss. The group attributed the loss to a drop in sales brought about by low stock levels and closure of some of its branches.
The supermarket group headed by Julius Kipng’etich announced closure of its stores in various african countries in October last year. Stores in Uganda and Tanzania and some branches in Kenya were closed down. This, coupled with a dip in supplier confidence, saw its stock shrink by 38 per cent to Sh3.4 billion in the first-half of the year. Uchumi chairperson Catherine Ngahu said: “Operating expenses grew by 12 per cent following rationalisation of 1,200 staff and costs related to implementation of a Collective Bargaining Agreement.”
Employee layoffs is also haunting the company as its operating expenses ballooned to Sh2 billion since it had to foot redundancy costs. This is a 37.6 per cent decline compared to the Sh6.8 billion net sales it managed in a similar period in 2014. The Nairobi Securities Exchange (NSE)-listed retailer managed to collect Sh4.3 billion from customers in the six months period under review. The loss-making supermarket also saw its assets drop by Sh1.8 billion as it continues to dispose of non-core assets. However, current liabilities hit Sh6 billion, reflecting a 57 per cent rise.