Atlas Africa Industries says it expects its profits for the 18 months ended December 31, 2015 to fall by more than 25 per cent.
The UK logistics company, which announced the closure of its Kenyan subsidiaries last December following a downturn in the oil and gas exploration sector, said the restructuring had significantly eaten into its margins.
“Atlas hereby issues a profit warning due to the likelihood that the company’s earnings for the 18 months ended December 31, 2015 will be more than 25 per cent lower than the last audited results to June 30, 2014,” it said.
It said significant decrease in earnings relate primarily to accounting adjustments due to restructuring of the group.
“As announced previously the Kenyan business, which was the majority of the trading activity, has been liquidated due to the global economic environment, in particular the curtailment of investment in the oil and gas sector. It is important to note the current reporting period was increased to 18 months, and these results are being compared with 12 month audited to June 30, 2014. This is as per the public announcement made on February 27, 2015, relating to the change in reporting periods,” it said.
During the year ending June 30, 2015, Atlas reported a net loss of Sh1 billion, mainly attributed to cancelled service contracts for oil and gas companies operating in Kenya.
In 2014, it reported a net loss of Sh147 million that was followed by a Sh609 million loss for the half year period to December 2014.
