No dividend for Eaagads shareholders despite profit

COFFEE BEANS AT THE NAIROBI COFFEE EXCHANGE SAMPLING ROOM ON MARCH 28, 2017 PHOTO | DIANA NGILA 

In Summary

• The company made a net profit of Sh18.1 million in the review period compared to Sh477,000 the year before, boosted by higher coffee prices and lower costs.
• Eaagads’ retained earnings rose to Sh201.7 million from Sh173.7 million after withholding the entire Sh18.1 million profit.
• The company says the conservative stance is informed by anticipation of reduced production in the current financial year owing to drought. Eaagads has not paid a dividend for years.

By VICTOR JUMA
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Agricultural firm Eaagads failed to pay a dividend despite its net profit surging 38 times in the year ended March, citing inadequate cash levels.

The company made a net profit of Sh18.1 million in the review period compared to Sh477,000 the year before, boosted by higher coffee prices and lower costs.

“Although the financial performance of the company improved during the current financial year, the reserves of the company are still not substantial enough to warrant a distribution to shareholders,” the coffee grower said in a statement.

“The board of directors therefore do not recommend payment of a dividend for the financial year.”

Eaagads’ retained earnings rose to Sh201.7 million from Sh173.7 million after withholding the entire Sh18.1 million profit. The company says the conservative stance is informed by anticipation of reduced production in the current financial year owing to drought. Eaagads has not paid a dividend for years.

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