Two of Kenya’s oldest tea producers, Williamson Tea Kenya Plc and its associate Kapchorua Tea Kenya Plc, have reported significant drops in profit for the financial year ending 31 March 2025, reflecting tough global conditions in the tea industry. The latest earnings reports from both companies show that despite slight improvements in revenue, global oversupply, currency pressures, and weakened export prices have badly affected their bottom line.
Kapchorua Tea, which is majority owned by the same group as Williamson Tea, saw its net profit slump by 55% to KSh 181 million, compared to KSh 399 million recorded in the previous financial year. This drop came even as revenue inched up by 1.1% to KSh 2.22 billion. However, its operating profit fell by 75%, leading to a significant decline in earnings per share, which dropped from KSh 51.04 to KSh 23.16.
The performance of Williamson Tea was even more concerning. The company recorded a net loss of KSh 166 million, reversing the KSh 527 million profit it made in the 2024 fiscal year. The group also posted an operating loss of KSh 392 million, with total comprehensive loss widening to KSh 209 million, while revenue dropped by 2% to KSh 4.11 billion.
The financial results did not come as a complete shock. On 20 May 2025, both tea firms had issued profit warnings, alerting investors that earnings would fall by more than 25% due to market instability. The companies blamed a global tea surplus, weaker international prices, and the strengthening of the Kenyan shilling, which made Kenyan tea less competitive abroad and reduced the value of export receipts.
Despite the poor performance, both firms have decided to reward their shareholders. Kapchorua Tea will pay a final dividend of KSh 25.00 per share, which is half of the KSh 50.00 total dividend it declared in FY2024. Williamson Tea chose to maintain its final dividend at KSh 10.00 per share, signalling its intention to stay consistent in shareholder return, even in a difficult year. Both companies will hold virtual Annual General Meetings (AGMs) on 28 August 2025, where shareholders will be asked to approve the dividend proposals. The record date is 31 July 2025, and payment is expected to be made on 2 September 2025.
In a related development, the boards of both companies have proposed bonus share issues as a way to boost shareholder value without draining cash reserves. Williamson Tea wants to capitalize KSh 87.56 million from its revenue reserves to issue one bonus share for every share held. Similarly, Kapchorua Tea plans to capitalize KSh 39.12 million from its reserves for the same 1:1 bonus issue ratio. These bonus shares will rank equally with existing shares and are expected to increase market activity when listed.
Market analysts say these results show how much global tea dynamics are affecting East African producers. Kenya, being one of the largest tea exporters in the world, is particularly exposed to global price fluctuations and forex volatility. The tea industry has faced continuous headwinds from increased competition from low-cost producers, changing weather patterns, and unstable foreign exchange rates. The rebound of the Kenyan shilling also affected earnings since most of the companies’ revenues are dollar-denominated.
Tea farming is a major economic activity in Kenya, especially in counties like Kericho, Bomet, and Nandi. Many of the country’s top listed tea firms source their tea from these regions, and any financial losses ripple down to smallholder farmers, transporters, and seasonal workers. With the ongoing volatility in the global commodities market, tea growers and exporters in Kenya may have to rethink their strategies to stay profitable.
The proposed bonus share issues are being viewed as a strategic move to maintain investor confidence. While they do not provide immediate cash to shareholders, they offer increased holdings that could yield more dividends in the future, once the companies return to profit.
Meanwhile, stakeholders in Kenya’s tea sector continue to call on the government to provide support through export promotion, price stabilization schemes, and currency risk hedging tools. They believe this would help mitigate losses in times of price downturns and improve competitiveness in international markets.
The results of both Williamson Tea and Kapchorua Tea underline the risks involved in agribusiness, especially for export-oriented firms that rely on global demand and favourable forex conditions. Their decision to maintain or moderately reduce dividends, along with issuing bonus shares, shows a cautious but proactive approach to navigating an uncertain future.
