- Net loss of GHS22.4m in 2017 as against GHS15.9m in 2016
- 50% of value of 2015/16 season stock of sheanut written off
The Produce Buying Company (PBC) has once again registered a substantial dip in revenues, making a net revenue loss of GHS22.4 million in 2017 against GHS15.9 million in 2016.
Key factors that contributed to the dwindling fortunes, the company disclosed, were the reduction in competitive buyers’ margins resulting in lower revenue, increase in operating cost in the midst of general price level increase of inputs and logistics, the discard of tonnes of sheanut found to have high free fatty acid due to over storage, and a lack of funds to purchase cocoa.
Speaking to the Goldstreet Business at the 17th AGM of the PBC, the company’s CEO, Mr. Kofi Owusu Boateng, blamed both external and internal factors for the downward slide in the company’s financial performance.
He explained that the PBC’s continuous reliance on borrowing from the market to supplement funds for purchases presented it with a cost outlay which was too heavy to bear.
“Sheanuts, which have been purchased in the 2015/2016 season for delivery to the PBC factory in Buipe have gone bad due to long periods of storage. Half of value of the stock of sheanut was written off,” he disclosed.
Those and many other factors, he said, has significantly affected the performance of the company since 2016.
With a new management assuming the leadership of the company, a number of far reaching measures and strategies have been put in place.
“The PBC has resolved to embark on a prudent cost and control measures to ensure that cost of operations are trimmed. We have also decided to review the various strategies and options to finance cocoa purchases,” Boateng said.
In 2017, the direct operating expenses of the PBC increased by 17 percent over the 2016 amount of GHS75 million to GHS88.4 million.
General and administrative expenses also rose by 25.9 percent from GHS46.4 million in 2016 to GHS58.6 million last year.
The company’s staff cost in 2017 increased by 19.5 percent from GHS33.2 million in 2016 to GHS39.7 million.
As a fully state-owned licensed buying company (LBCs), PBC, over the years has remained the highest cocoa purchaser for COCOBOD among the other LBCs with a market share of about 31 percent.
The Company since its listing on the Ghana Stock Exchange has chalked many successes and steadily has developed to be a major player in the Cocoa Industry despite recording net losses in the past years.
As part of its strategy to maintain and improve on its share of the market with regards to cocoa purchases, the company has established alliances with some International cocoa trading companies to roll out schemes that will increase the yield and acreage of farmers.
PBC has over the years received recognition both on the local and international fronts. The Prestigious Ghana Club 100 ranking has seen the Company move from the 89th position in 2008 to an enviable number one position in 2010.
That position was successfully retained in 2011 making PBC, one of the few companies in the country to retain this position for two consecutive years.
By Wisdom Jonny-Nuekpe