KENYA – Unga Group, one of the largest grain millers and feed suppliers in Kenya, has undertaken another restructuring of its business in an effort to adopt a more cost-effective structure.
Under the new changes, the company’s two subsidiaries; Unga Limited and Unga Farm Care (EA) Limited will fall under the management of Group Managing Director and CEO Mr. Joseph Choge.
Previously, the subsidiaries had their own heads who reported to the CEO of the listed entity –Unga Group— through a series of chains of command.
Unga Limited which deals in milling wheat and maize for human consumption was under the leadership of Mr. Andanje Mwairumba .
Dickson Jawichre, served as the general manager for Unga Farm Care (EA) Limited which processes animal nutrition products.
“I wish to notify you that our senior colleagues, Mr Andanje Mwairumba, general manager of Unga Limited and Dickson Jawichre, general manager Unga Farm Care (EA) Limited, will be leaving the company effective today,” Mr Choge wrote in a memo dated November 21.
“The organization will now revolve to a leaner structure with the group managing director as the lead for both subsidiaries”
The two gentlemen have since left the organization and join 117 others who have left the miller since last year when cost-cutting measures were switched on to restore the business to profitability.
Unga group admits to feeling the heat of increased competition from other millers and raw material price inflation reducing their marginal sales growth.
“The competitive landscape has continued to intensify, with over 50 new millers joining the fray over the last two years alone,” Mr. Choge said in another report.
There are also cheap poultry imports from the region and fish from Asia, shrinking the company’s market share for nutritional animal products.
The company experienced losses in operating costs at Sh 502 million, a reverse from the operating profit of Sh 616.2 million the previous year.
Unga however saw its net profit grow to Sh311.3 million from Sh293.4 million, benefitting from a one-time gain of Sh802.5 million from the sale of its Ennsvalley bakery business.
Despite the hiccups in the business, Unga says it will continue to differentiate itself as a quality product supplier to maintain its premium brand.