Limuru Tea issues profit warning as earnings set to fall over 25% on weak tea prices
Higher labour costs and weak auction prices weigh on profitability.
KENYA – Listed tea grower Limuru Tea has warned shareholders of a sharp decline in earnings for the financial year ending 31 December 2025, citing higher labour costs and weak tea prices at the Mombasa Tea Auction.
In a formal announcement, the company said it expects full-year profit to fall by more than 25% compared to the previous year after reviewing its preliminary financial results.
“The Company is expected to record a decline of more than 25% in profit after tax attributable to the shareholders of the Company for the financial year ending 31 December 2025 as compared with that for the same period ending 31 December 2024,” read part of the notice.
According to the board, the projected decline is mainly attributed to increased labour expenses following industry-wide wage increments, as well as reduced tea prices at the Mombasa Tea Auction.
The company noted that tea prices declined between 2024 and 2025 due to lower global demand and high Kenyan stock levels.
Limuru Tea stated that the profit warning is based on information currently available to the Board and a preliminary evaluation of its financial statements for the 12-month period.
The final audited financial results for the year ended 31 December 2025 are expected to be released by the end of March 2026.
“As a matter of policy, the CMA does not assume responsibility for the accuracy of any of the statements made or opinions or reports expressed or referred to in this announcement,” the company wrote in the notice.
In the first half of 2025, Limuru Tea reported a net loss of KES 22.2 million, more than triple the KES 6.8 million (US$52.6k) loss recorded during the same period in 2024.
Despite the loss, revenue rose 8% to KES 56.84 million from KES 52.85 million (US$409k) a year earlier, supported by higher tea volumes and increased turnover.
At the time, the board opted not to declare an interim dividend, citing rising labour and production costs alongside soft global tea prices, which were further pressured by foreign exchange fluctuations in key markets.
The latest warning follows a similar notice issued in 2024, when the company informed investors that its earnings for the year ending 31 December 2023 were expected to decline by more than 25% compared to the prior year, largely due to elevated labour costs and ongoing operational challenges.
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