Atlas issues profit warning as restructuring costs bite
Atlas Development and Support Services Limited CEO Carl Esprey. FILE PHOTO | SALATON NJAU | NATION MEDIA GROUP
What you need to know:
- The Kenyan business, which was the majority of the trading activity, was liquidated due to the global economic environment.
The impact of a turbulent year has continued to eat into company profits with Logistics firm Atlas Development and Support Services joining 19 other listed companies in issuing a profit warning.
Atlas in a regulatory filing said that the company faced accounting adjustment losses as they restructured.
“Atlas hereby issues a profit warning due to the likelihood that the Company’s earnings for the 18 months ended 31st December 2015 will be more than 25 per cent lower than last audited results to 30th June 2014,” the firm said in a statement.
The statement said that the Kenyan business, which was the majority of the trading activity, was liquidated due to the global economic environment, in particular the curtailment of investment in the oil and gas sector.
The oil and gas logistics firm suffered a Sh1 billion loss in June due to reduced contracts from oil and gas exploration companies especially around Turkana, and made a decision to divert its resources from Kenya to Tanzania and Ethiopia.
ALSO READ: UK logistics firm closes Kenya business
The firm recently announced it had gotten into a deal with Ethiopian Raya Brewery for the supply of beer bottles which will be made at Atlas’ upcoming glass plant near Addis Ababa after raising $5 million (Sh501 million) in a private placement to finance the feasibility study and initial construction work for the factory.
