Williamson, Kapchorua Tea report earnings decline, unveil bonus share plans amid market pressures 

,KENYA – Two of Kenya’s longest-standing agricultural firms, Williamson Tea Kenya Plc and Kapchorua Tea Kenya Plc, have announced weakened earnings for the financial year ending March 2025, citing rising operational costs and unfavorable market conditions. 

Williamson Tea posted a net loss of KES 166 million (US$1.3M), reversing a profit of KES 526 million (US$4.1M) reported in the previous year.  

Kapchorua Tea, although remaining profitable, saw its net earnings fall to KES 181 million (US$1.4M) from KES 399 million (US$ 3.1M) recorded a year earlier. 

Revenue trends showed mixed performance between the companies. Williamson Tea reported a slight decline in revenue, down 2% to KES 4.1 billion (US$31.7M), while Kapchorua Tea registered an income increase to KES 2.2 billion (US$17M), up from KES 1.2 billion (US$9.3M).  

However, both firms experienced a sharp plunge of operating income, pointing to a surge in input and processing costs. 

Earlier in May, the two Nairobi Securities Exchange-listed companies had issued profit warnings. They attributed their outlook to falling global tea prices due to oversupply, alongside a stronger Kenyan shilling which negatively impacted export margins. 

Despite the financial setback, both companies announced dividend payouts, according to Business Daily. Williamson Tea proposed a dividend of KES 10 per share, while Kapchorua Tea will distribute KES 25 per share to its shareholders. 

In a bid to strengthen shareholder value, the two tea producers also unveiled bonus share plans funded from reserves. Williamson Tea intends to issue 17.5 million new shares valued at KES 87.5 million (US$677K) on a one-for-one basis.  

Similarly, Kapchorua Tea plans to raise KES 39.1 million (US$302.5K) through a bonus issue at the same ratio. 

These bonus issues come after both companies increased their authorized share capital in 2024, allowing the allocation of new shares. 

Looking ahead, the firms aim to reduce operational expenses through technology adoption and maintain their positioning with premium tea brands.  

Additionally, they are optimistic about China’s proposed removal of tariffs on African imports and enhanced trade agreements, which could significantly boost Kenya’s tea exports. 

China plans to eliminate tariffs on African goods under a new economic pact, while Kenya targets an increase in tea exports to China from 12.2 million kilograms in 2024 to 50 million kilograms by 2030. 

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