Bloomberg News

Mumias Sugar Extends Gains on Speculation of Earnings Growth

October 27, 2011

Oct. 27 (Bloomberg) -- Mumias Sugar Co., Kenya’s biggest maker of the sweetener, gained for a fourth day on speculation earnings for the current fiscal year will grow as commodity prices remain high.

The stock climbed 3.1 percent, to 6.65 shillings as of 2:02 p.m. in the capital, Nairobi, paring the year-to-date fall to 31 percent.

“In as much as the production is low, they are likely to report a higher profit in 2012 because prices are going up,” Deris Mogoi, a research analyst at Nairobi-based Standard Investment Bank Ltd., said by phone today.“There is that positive sentiment coming from investors,”

Net income rose to 1.93 billion shillings ($19 million), or 1.26 shillings per share, for the year ended June 30 from 1.57 billion shillings, or 1.03 shillings a share, a year earlier, the company said on Aug. 26.

Kenyan sugar prices rose to a record 200 shillings a kilogram due to a shortage of the sweetener, Business Daily said Aug. 23. Retail prices have increased 100 percent this year, the Nairobi-based newspaper reported, without saying where it got the information.

--Editors: James Kraus, Peter Branton

To contact the reporter on this story: Eric Ombok in Nairobi at eombok@bloomberg.net

To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net


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