Listed retailer Uchumi Supermarkets has sunk into more problems, dashing a recovery plan hatched by the government, lenders and creditors.
The retailer saw its half year profit drop to 900 million shillings in the period June to December 2017.
The company has however managed to cut down its expenses due to closure of some loss making units as well as a staff rationalization programme.
Despite a much talked about turnaround plan, Uchumi Supermarkets’ troubles appear to be far from over if it’s latest uncounted financial results are anything to go by.
Revenue from sales dropped by more than 100 percent between June to December 2017 to 527 million shillings down from 1.85 billion shillings.
The drop is attributed to a sharp decline in foot traffic as customers shied away from its empty shelves.
The company weighed down by debts remains insolvent unless urgent financial measures are instituted.
Current liabilities stand at 6.4 billion shillings against assets worth 4.1 billion shillings.
Last December, the retailer embarked on a restocking exercise after a 700 million credit facility from the National Treasury.
However the impact of this financial lifeline is yet to be felt.
The company closed down two branches in December which include the Capital Center branch and the loss making Jipange branch on Thika road.
The retailer has also announced plans to close one of its key branches at Sarit center in April this year, raising doubts on the future of the listed supermarket.
Uchumi, the oldest supermarket chain in the country is struggling to regain its foothold in a market now dominated by local retailers Tuskys and Naivas.
The entry of French retailer Carrefour has further enhanced competition in the local retail sector.