Kakuzi expands offerings for stronger shareholder gains
Fruit exporter Kakuzi is gearing up to make its pioneer property development investment in the retail sector by developing Kakuzi Farmers Market as part of optimising shareholder returns.
The retail centre, which be located opposite the firm’s headquarters on the Nairobi-Nyeri highway, will see Kakuzi sell its range of value-added products to customers in Kenya.
The location for the Nairobi Securities Exchange listed company will also enable it to provide a decent market for up-country travelers to stop and refresh.
Further, Kakuzi is in the final stages of a commercial appraisal in readiness for a full-scale Blueberries production venture investment at an estimated cost of Kes4 billion.
“This is an exciting opportunity that the Board is appraising keenly as it is a major undertaking with an estimated investment cost of around Ksh4 Billion,” Chairman Nicholas Ng’ang’a said during the firm’s 95th AGM.
These initiatives are part of the firm’s undertakings to maintain a products and markets diversity strategy aimed at enhancing shareholder gains.
Speaking to the firm’s shareholders Kakuzi Chairman, Mr Ng’ang’a and CEO Chris Flowers said the superfoods grower has set sights on enhancing revenue generation from diversified local and export market produce.
Plans are also underway to commission Kakuzi’s Macadamia Oil Extraction Plant as the company seeks to meet the growing demand for value-added products within its superfoods portfolio.
Read also: Kakuzi to resume avocado exports in May
Domestic sales of value-added macadamia products will also help mitigate challenges in the international markets due to a prevailing macadamia glut in globally.
“We believe that the diversity of products, markets and routes to market are essential elements of Kakuzi’s business strategy. Having the combination of avocados, macadamias and hopefully blueberry as export crops to America, Japan, Europe, China, the Middle East, and the UK, as well as a strong domestic value addition range, we believe, gives us the greatest opportunities to minimize risk and maximize returns in these difficult international market conditions,” Mr Flowers said.
Mr Ng’ang’a said the board is currently reviewing and refining the final investment decision for the firm’s Blueberry venture.
On the firm’s land assets, Kakuzi, he said, has the potential to develop up to 200 hectares of blueberry production which can generate an additional Kes5 billion per year.
He added: “In addition, the Kakuzi Farmers Market will also provide a retail opportunity for a section of the local smallholder farmers as we plan to provide an opportunity for them also to sell their produce and wares to the captive market on this new road that traverses through Muranga, Kirinyaga and Nyeri counties,” Mr Ng’ang’a explained.
Since 2018, Kakuzi has increased by 24 percent the areas under avocado production from 798 hectares to 987 hectares.
The company has also nearly doubled its macadamia orchards to 1,128 ha from 621 ha and doubled the avocado Packhouse from a capacity of 8 tonnes to 16 tonnes per hour with expanded cold chain solutions.
As part of its climate-smart agriculture commitments, Kakuzi has invested in expanded irrigation capacity with the construction of 19 separate earth dams holding 12 million cubic meters of water with the capacity to irrigate a total of 1,600 ha of macadamia, avocado, and blueberry crops.
In the financial year ended December 2022, Kakuzi posted a Kes845.8 million net profit, representing a 62 percent after-tax profit growth.
The earnings were underpinned by a total sales revenue jump amounting to Kes4.4 billion, up from Kes3.2 billion posted the previous year, and boosted by additional sales for forestry, livestock, and blueberry produce in the local market.
Following the AGM, Kakuzi shareholders will enjoy a Kes24 dividend payout, up from the Kes22 payout the previous year. The dividends shall be paid on 30th June 2023 to the shareholders on the members’ register as at the close of business on Wednesday 31st May 2023.