KENYA – The Kenya Tea Development Agency (KTDA) Holdings profit rose nearly 59%in the year ending June 30, 2018 as it records an increase in a global commodity prices and higher sales, reports Kenya Digest.

The firm’s revenues as a result of higher sales rose by 13.4% to US$25.5million billion despite a much lower growth in global prices of 0.3%.

According to a financial report released by the company, this greatly helped push profit after tax to US$18.05 million, an increase from US$10.79 million in the previous year.

“There was a slight increase in global tea prices from 3.13 US dollars to 3.14 US dollars.

This resulted in an increase in the sales during the year. Increase in Greenleaf harvest resulted to increase in sales volume,” said the report.

KTDA also earns a management fee from managed tea factory companies and currently has increased its pool into eight subsidiaries helping it earn from other activities such as warehousing charges and value addition.

“The Group’s performance has increased significantly in the year.

Increase in profit before tax by 58.8 per cent is mainly attributable to good performance across a number of entities in the group such as Chai Trading Company and Greenland Fedha, which saw a significant increase in their profits,” the firm said in its financial report for the year to June 30, 2018.

Among the most notable subsidiaries are Chai Trading – which specializes on warehousing and logistics of the auction and shipping of processed tea – and Greenland Fedha – which provides cheap credit to farmers.

“For Greenland Fedha, this translated to an increase in uptake of loans as farmers use Greenleaf as collateral for loans and advances,” said the report.

Despite the good performance across the board, the firm faced challenges arising from the general economic slowdown and problems in specific entities.

Chai Trading, for example, had to increase provisions for receivables (unpaid debts) amounting to US$1.64million following a cut in sales to Iran that was subjected to sanctions by the US.