KENYA – Kenya’s Uchumi Supermarkets swung to an loss after tax of 3.2 billion shillings ($31.37 million) for its year ended June, partly due to an impairment charge for closing some regional outlets as part of a turnaround plan.
Uchumi, which has new management, had reported a profit of 491 million shillings in the same period a year earlier. The board sacked former chief executive Jonathan Ciano in June and launched an investigation into the company’s financial affairs.
Julius Kipngetich, picked in August to replace him, has since announced measures to return the firm to profit, including closing loss-making outlets in Tanzania and Uganda.
Uchumi said its revenue dropped to 12.9 billion shillings from 14.6 billion shillings in the previous period. It also said it had taken a 1.6 billion shilling provision for impairment from its closure of the Uganda and Tanzania stores.
It wrote off 1.04 billion shillings due to “misrepresentations” by the management that was fired.
“The auditors have restated some prior year numbers to reflect the correct financial position of the organization as at June 30, 2015,” Uchumi said.
Uchumi, which is the only listed retail chain in Kenya, faces growing competition from privately held Nakumatt and new entrants including a franchisee of France’s Carrefour – Reuters