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PCL profit down 7%

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By Taonga Sabola:

Malawi Stock Exchange-listed conglomerate Press Corporations Limited (PCL) has posted a 7 percent drop in profitability for the year ended December 31 2018.

In a statement on Wednesday, the firm says it recorded an after-tax profit of K36.71 billion in 2018, down from K39.67 billion in 2017.

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In the statement, signed by directors Patrick Khembo, George Partridge, Estelle Nuka and Elizabeth Mafeni, the conglomerate says the 2017 profit was higher after taking into account a K14.28 billion profit on the disposal of 19 percent stakes in Castel Malawi.

The firm notes that, in 2018, it realised K6.16 billion from the disposal of a 60 percent stake in Open Connect Limited.

“Excluding the above mentioned once off items, the group therefore registered a 20 percent increase in its underlying profit after tax.

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“The strong performance was driven by continued improvements in operating efficiencies that resulted in cost reductions, notwithstanding t h e prevailing poor operating environment characterised by severe power challenges and weak demand for goods and services,” reads the statement in part.

In 2018, PCL acquired a 15 percent stake in Sunbird Tourism PLC in line with its strategy to invest in tourism.

PCL says all but two of its subsidiaries, Peoples and Maldeco, posted profits in 2018.

It further says one of its joint ventures, Castel Malawi, also made a loss mainly due to rehabilitation costs, reduced margins occasioned by the impact of erratic power supply and the attendant operating and quality control challenges.

Looking ahead, PCL says it is well positioned to exploit growth opportunities both locally and in the region following the restructuring of most of the businesses.

PLC further says the prevailing stable macro-economic environment provides a platform for continued growth.

“The agriculture sector is expected to perform well following the good rains received across the country, which will have a positive impact on disposable incomes and demand for goods and services.

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