Cocoa Processing Company declares loss of $16.3m in 2014
The Cocoa Processing Company Limited (CPC) has again failed to declare dividends to its shareholders because of the huge losses it incurred over the 2014 fiscal year.
The company reported a loss of $16.3 million in 2014 compared with $11.8 million in 2013.
Its current liabilities as at September 2014, stood at $60.1 million up from $48.4 million in the previous year.
The Company’s turnover fell to $36.4 million compared to $ 60,186,136 in 2013 and this represents a decrease of 39.52 per cent.
Mr Jacob S. Arthur, the Board Chairman of CPC, told the Annual General Meeting (AGM) in Accra on Wednesday that, a substantial part of the Company’s liabilities was due to the Ghana Cocoa Board (COCOBOD) and a syndicate of banks.
He attributed the poor performance during the year to both external and internal difficulties.
Mr Arthur said the fall in global crude oil prices, combined with recession and high unemployment rates in several of the Eurozone countries, which are a major trading area of the Company, greatly affected growth prospects.
Besides, the low rate of processing cocoa beans due to its unavailability also affected the performance of the company.
The Company expected to receive for processing 30,000 metric tonnes of cocoa beans during the year, however, by September 2014, only 16,672.78 metric tonnes had been received and processed.
This, he said, represented only 55.58 per cent of the requirement, as per its strategic recovery plan.
Mr Arthur said the company’s operations were also affected by diesel shortages experienced in the country as its plants relied heavily on such fuel to power its boilers.
Also, external power outages resulted in frequent electrical and mechanical faults, frustrating the Company’s efforts at achieving its operational objectives for the year.
Mr Arthur said the company was currently tottering under severe financial constraints after repaying a loan of $4.84 million as principal and interest to the syndicated banks.
He, however, stated that the Directors and Management embarked on some cost reduction strategies and had been able to switch from diesel usage to liquefied petroleum gas, which was cheaper for the production process.
The Company has also completed a borehole and a reverse osmosis project to provide an alternative source of water supply, in order to free its operations from the frequent interruptions from the Ghana water Company.
He said it is hoped that with the completion of these projects, two major cost drivers would be contained to reduce its cost of processing.
He said the COCOBOD has given the assurance of continued supply of cocoa beans to the company and would in addition, not seek any repayment of amount due to it, in a manner that would jeopardise the ability of the company to continue operations.
He said the Board and Management would explore available opportunities and pursue alternative uses of its idle plant capacities to increase revenue.
Shareholders were, however, not happy about the perennial losses being recorded by the Company and charged its Board and Directors to come out with sustainable strategies to improve its output and also declare profits after many years of failure.
Source: GNA