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Kenya's Longhorn Swings To Year Profit, Warns On Taxes
20/09/2013
NAIROBI (Reuters) - Kenyan book publisher Longhorn swung to a pretax profit of 151 million shillings in the year through June, but warned that recently introduced tax measures would affect its prospects.
The company, which had posted a 25.9 million shilling loss the year before, attributed the better-than-forecast performance to robust demand at home and in the export markets of Uganda, South Sudan, Tanzania and Rwanda.
Its own internal forecast had been for 121.9 million shillings at the pretax level.
Turnover rose by a third to just over 1 billion shillings, the company said, adding it would pay a dividend of 0.80 shillings per share on earnings per share of 1.61 shillings.
Authorities in Kenya enacted a value added or sales tax last month, slapping taxes on items including books, and sending the retail price of various items higher.
"This is expected to slow down business and negatively impact on product volumes uptake," Longhorn said in a statement.
It however added that a stable economic outlook in the region could cushion it somewhat from the impact of the new taxes.
Longhorn, which is best known for text books, has been investing in electronic learning materials, in a variety of media and platforms, to benefit from the new Kenyan government's pledge to equip all school children with laptop computers.
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