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Unga HY 2016-2017 over 59% drop in profits
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obiero
#11 Posted : Friday, February 24, 2017 4:51:47 PM
Rank: Elder

Joined: 6/23/2009
Posts: 14,226
Location: nairobi
snipermnoma wrote:
obiero wrote:
Unga Limited has already reached June 2017 as per their profit warning.. If a company cannot afford to spellcheck then can we really expect a profit


Help me understand what you mean. The way I read this I see no need for spell check. They expect PBT for th ecurrent financial year which ends in June 2017 will be at least 25% lower than the previous year ending June 2016. To me it makes sense...what am I missing?

Gai. Pole
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VituVingiSana
#12 Posted : Friday, February 24, 2017 6:25:18 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,349
Location: Nairobi
obiero wrote:
Unga Limited has already reached June 2017 as per their profit warning.. If a company cannot afford to spellcheck then can we really expect a profit

Unlike some bandia firms, Unga is telling shareholders that it will have a poor year 4 months before the year end. Bandia firms tell you that just before year end results are released.

I appreciate the honesty.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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VituVingiSana
#13 Posted : Friday, February 24, 2017 6:29:54 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,349
Location: Nairobi
Chaka wrote:
Pesa Nane wrote:
Sad Sad



Forgive my ignorance..what does the depreciation of the KES and UGX got to do with profit?Does the Co. have a forex loan or do they import inputs?

Yes.
Wheat is imported.
The new wheat mill was also imported using forex loans.
The silos installed in Eldoret were also imported.
The refurbishment of silos in Nairobi use imported materials.

UGX has depreciated vs KES.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Spikes
#14 Posted : Friday, February 24, 2017 6:30:31 PM
Rank: Elder

Joined: 9/20/2015
Posts: 2,811
Location: Mombasa
karasinga wrote:
Pesa Nane wrote:
Sad Sad



Charts don't lie. check prior analysis here before the" news". I think the time has come for us to combine both tech analysis and fundamentals.
best wishes

Absolutely!
John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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ombaalbt
#15 Posted : Friday, February 24, 2017 7:50:00 PM
Rank: New-farer

Joined: 5/19/2014
Posts: 68
Location: Migori
obiero wrote:
sparkly wrote:
obiero wrote:
Unga Limited has already reached June 2017 as per their profit warning.. If a company cannot afford to spellcheck then can we really expect a profit


You are the one who is slowEh?

Hehe

English is a fifth language for some.Laughing out loudly Laughing out loudly d'oh! d'oh!
Learning to sit on my hands
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Ebenyo
#16 Posted : Friday, February 24, 2017 10:28:20 PM
Rank: Veteran

Joined: 4/4/2016
Posts: 2,016
Location: Kitale
karasinga wrote:
Pesa Nane wrote:
Sad Sad



Charts don't lie. check prior analysis here before the" news". I think the time has come for us to combine both tech analysis and fundamentals.
best wishes


difficult to understand the charts!
Towards the goal of financial freedom
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Ebenyo
#17 Posted : Tuesday, March 28, 2017 9:03:02 PM
Rank: Veteran

Joined: 4/4/2016
Posts: 2,016
Location: Kitale
Some of the raw materials could be sourced
locally.This will help bring down operation cost.
I hope that seaboard corporation does not wish
the situation to remain like this just because they
benefit from supply of some of the raw materials.
Operation costs consumed 98% of the hy earnings
i.e out of the total hy income of kshs 10,295,142000 operation costs consumed kshs 10,073,920.This left a profit margin of 1%.This must improve going forward for the company to be healthy.
Towards the goal of financial freedom
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  | | Edit by user: Tuesday, March 28, 2017 9:12 PM | Reason: Not specified
VituVingiSana
#18 Posted : Tuesday, March 28, 2017 9:36:36 PM
Rank: Chief

Joined: 1/3/2007
Posts: 18,349
Location: Nairobi
Ebenyo wrote:
Some of the raw materials could be sourced
locally.This will help bring down operation cost.
I hope that seaboard corporation does not wish
the situation to remain like this just because they
benefit from supply of some of the raw materials.
Operation costs consumed 98% of the hy earnings
i.e out of the total hy income of kshs 10,295,142000 operation costs consumed kshs 10,073,920.This left a profit margin of 1%.This must improve going forward for the company to be healthy.

Wheat - Very little is grown locally vs (growing) demand. Plus local wheat tends to be pricier than imports.
Maize - You know the story. Local production < Demand
Soybeans - Same as wheat. Most local soybeans are of poor quality. Cheaper to import from India.

Seaboard supplies raw materials but Unga says they get a good deal coz of Seaboard's buying power as well as good credit terms.

Yes, those margins are low but there isn't much pricing power for a politically sensitive FMCG.
2016-17 will be awful with the drought, elections, high interest costs and broke retailers e.g. Nakumatt, Uchumi, etc. Ennsvalley has closed stores (in Nakumatt) and there may be write-offs of fixtures & equipment plus costs of layoffs.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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obiero
#19 Posted : Wednesday, March 29, 2017 6:49:34 AM
Rank: Elder

Joined: 6/23/2009
Posts: 14,226
Location: nairobi
VituVingiSana wrote:
Ebenyo wrote:
Some of the raw materials could be sourced
locally.This will help bring down operation cost.
I hope that seaboard corporation does not wish
the situation to remain like this just because they
benefit from supply of some of the raw materials.
Operation costs consumed 98% of the hy earnings
i.e out of the total hy income of kshs 10,295,142000 operation costs consumed kshs 10,073,920.This left a profit margin of 1%.This must improve going forward for the company to be healthy.

Wheat - Very little is grown locally vs (growing) demand. Plus local wheat tends to be pricier than imports.
Maize - You know the story. Local production < Demand
Soybeans - Same as wheat. Most local soybeans are of poor quality. Cheaper to import from India.

Seaboard supplies raw materials but Unga says they get a good deal coz of Seaboard's buying power as well as good credit terms.

Yes, those margins are low but there isn't much pricing power for a politically sensitive FMCG.
2016-17 will be awful with the drought, elections, high interest costs and broke retailers e.g. Nakumatt, Uchumi, etc. Ennsvalley has closed stores (in Nakumatt) and there may be write-offs of fixtures & equipment plus costs of layoffs.

@vvs @guru used to worship this share

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Spikes
#20 Posted : Wednesday, March 29, 2017 7:17:21 AM
Rank: Elder

Joined: 9/20/2015
Posts: 2,811
Location: Mombasa
obiero wrote:
VituVingiSana wrote:
Ebenyo wrote:
Some of the raw materials could be sourced
locally.This will help bring down operation cost.
I hope that seaboard corporation does not wish
the situation to remain like this just because they
benefit from supply of some of the raw materials.
Operation costs consumed 98% of the hy earnings
i.e out of the total hy income of kshs 10,295,142000 operation costs consumed kshs 10,073,920.This left a profit margin of 1%.This must improve going forward for the company to be healthy.

Wheat - Very little is grown locally vs (growing) demand. Plus local wheat tends to be pricier than imports.
Maize - You know the story. Local production < Demand
Soybeans - Same as wheat. Most local soybeans are of poor quality. Cheaper to import from India.

Seaboard supplies raw materials but Unga says they get a good deal coz of Seaboard's buying power as well as good credit terms.

Yes, those margins are low but there isn't much pricing power for a politically sensitive FMCG.
2016-17 will be awful with the drought, elections, high interest costs and broke retailers e.g. Nakumatt, Uchumi, etc. Ennsvalley has closed stores (in Nakumatt) and there may be write-offs of fixtures & equipment plus costs of layoffs.

@vvs @guru used to worship this share

"worship" Laughing out loudly Laughing out loudly Laughing out loudly At least they had a starting point of analysing stocks.
John 5:17 But Jesus replied, “My Father is always working, and so am I.”
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  | | Edit by user: Wednesday, March 29, 2017 7:19 AM | Reason: Not specified
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