Listed cement company Bamburi has warned investors that its 2023 profit will be significantly lower than 2022 due to a one-time expense from selling its Ugandan subsidiary.
The company expects net earnings to be at least 25% less than the KSh181 million reported in 2022 and not exceed KSh135.8 million.
“The expected decline in net earnings is largely attributable to the one-off settlement of outstanding tax liabilities and legal disputes in Hima Cement Limited in Uganda as part of the closure of the sale transaction, thereby impacting 2023 results,” the company said through a notice published on Tuesday.
Now Bamburi to zero pic.twitter.com/nVrW0JhkEC
— Market Cap Trainers (@NSE_Investors) April 2, 2024
Bamburi finalized the sale of its entire 70% stake in Hima Cement in March 2024 for $84 million (KSh12 billion).
Background on Tax Issues
The Kenyan claim included penalties and interest that Bamburi sought to waive, but the request was denied.
These tax assessments originated from 2007 to 2011 for Kenyan operations and a separate Sh956 million claim in Uganda for Hima Cement.
Bamburi’s 2022 profit of Sh181 million already represented an 86.9% drop compared to the prior year due to reduced sales and increased costs.
