16 MAY 2023

Kakuzi Maintains Focus on Produce and Markets Diversity to Enhance Shareholder Returns

...as shareholders approve a Kshs 24 dividend payout during the firm’s 95 AGM

Kakuzi Plc will maintain a products and markets diversity strategy geared at enhancing shareholder returns, the firm’s Board leadership has confirmed.

As part of the shareholder returns enhancement strategy, Kakuzi Plc is gearing up to make its pioneer property development investment in the retail sector as it develops Kakuzi Farmers Market. The retail enterprise, to be located opposite the firm’s headquarters on the Nairobi-Nyeri highway, will allow Kakuzi to sell its recently introduced range of value-added products and provide a decent place for up-country travelers to stop and refresh. 

Kakuzi is also in the final stages of a commercial appraisal process for a full-scale Blueberries production venture at a Ksh 4 Billion estimated cost.

Speaking when they addressed the firm’s shareholders at the 95th Annual General Meeting, Kakuzi Chairman Mr Nick Ng’ang’a and Managing Director Mr Chris Flowers assured that the superfoods grower is actively focusing on enhanced revenue generation from diversified local and export market produce.

The firm is also set to commission a Macadamia Oil Extraction Plant to meet the growing demand for value-added products within its superfoods portfolio. Domestic sales of value-added macadamia products will also help mitigate challenges in the international arena due to a prevailing macadamia glut in the global market.

“We believe that the diversity of products, markets and routes to market are essential elements of Kakuzi’s business strategy. Having the combination of avocados, macadamias and hopefully blueberry as export crops to America, Japan, Europe, China, the Middle East and the UK, as well as a strong domestic value addition range, we believe, gives us the greatest opportunities to minimize risk and maximize returns in these difficult international market conditions,” Kakuzi Managing Director Mr Flowers said.

On his part, the Board, Mr Ng’ang’a said, is reviewing and refining the final investment decision for the firm’s Blueberry venture. On the firm’s land assets, Kakuzi, he said, has the potential to develop up to 200 hectares of blueberry production which can generate an additional Ksh 5 billion turnover per annum for the Company. “This is an exciting opportunity that the Board is appraising keenly as it is a major undertaking with an estimated investment cost of around Ksh 4 Billion,” Mr Ng’ang’a said.

He added: “In addition, the Kakuzi Farmers Market will also provide a retail opportunity for a section of the local smallholder farmers as we plan to provide an opportunity for them also to sell their produce and wares to the captive market on this new road that traverses through Muranga, Kirinyaga and Nyeri counties,” Ng’ang’a explained.

In the last five years, Kakuzi Managing Director Mr Flowers disclosed that the firm has increased by 24% the areas under avocado production from 798 ha to 987 hectares. The firm has also nearly doubled its macadamia orchards from 621 ha to 1,128 ha and doubled the avocado Packhouse from a capacity of 8 tons to 16 tons per hour with expanded cold chain solutions.

As part of its climate-smart agriculture commitments, Kakuzi has also further invested in expanded irrigation capacity with the construction of 19 separate earth dams holding 12 million cubic meters of water with the capacity to irrigate a total of 1,600 ha of macadamia, avocado and blueberry crops.  

In the last financial year, Kakuzi posted a Kshs 845.8 million net profit for the financial year ended 31st December 2022, representing a 62% after-tax profit growth. The leading Avocado and Macadamia grower and exporter attained a historical record growth against its pretax profit, which closed at Kshs 1.22 billion, a 159% increase, up from the Kshs 472 million posted the previous year.

The earnings were underpinned by a total sales revenue jump amounting to Kshs 4.4 billion, up from Kshs 3.2 billion posted the previous year, and boosted by additional sales for forestry, livestock, and blueberry produce in the local market.

Following the AGM, Kakuzi shareholders will enjoy a KSh 24 dividend payout, as earlier recommended by the Board and approved at the meeting yesterday, up from the Kshs 22 payout the previous year. The enhanced dividends shall be paid on 30th June 2023 to the shareholders on the members’ register as at the close of business on Wednesday 31st May 2023.

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