The Produce Buying Company (PBC) has recorded a decrease in revenues, indicating a net revenue loss of GH¢22.4 million in 2017 as against GH¢15.9 million in 2016.
The Chief Executive Officer (CEO) of the Company Kofi Owusu Boateng, at the 17th Annual General Meeting (AGM) on July 25, 2018, in Accra, said the downward trend of the company’s financial performance is due some external and internal factors.
These he named to include the reduction in competitive buyers’ margins resulting in lower revenue, increase in operating cost in the midst of general price level increase of inputs and logistics, the discard of tonnes of Shea nuts found to have high free fatty acid due to over storage, and lack of funds to purchase cocoa attributed greatly to the decrease.
He said the company’s continuous borrowing from the market to supplement funds for purchases presented it with a cost outlay which was too heavy to bear.
He said, Shea nuts, purchased in the 2015/2016 season for delivery to the PBC factory in Buipe went bad due to long periods of storage. Half of the value of the stock of Shea nuts was written off. “These and many other factors has significantly affected the performance of the company since 2016.
With a new management assuming the leadership of the company, a number of far reaching measures and strategies have been put in place.
The PBC, he said has taken steps to embark on a prudent cost and control measures to ensure that cost of operations are trimmed, and has also decided to review the various strategies and options to finance cocoa purchases in the country.
According to their report, in 2017, the direct operating expenses of the PBC increased by 17% over the 2016 amount of GH¢75 million to GH¢88.4 million, whereas general and administrative expenses also rose by 25.9% from GH¢46.4 million in 2016 to GH¢58.6 million in 2017.
The company’s staff cost also increased by 19.5% from GH¢33.2 million in 2016 to GH¢39.7 million in 2017.
As a fully state-owned licensed buying company (LBCs), PBC, over the years has remained the highest cocoa purchaser for COCOBOD among the other LBCs with a market share of about 31%.
The Company since its listing on the Ghana Stock Exchange has chalked many successes and steadily has developed to be a major player in the Cocoa Industry despite recording net losses in the past years.
In order to maintain and improve on its share of the market with respect to cocoa purchases in the country, the company has established alliances with some International cocoa trading companies to roll out schemes that will increase the yield and acreage of farmers.
Meanwhile, PBC has over the years received recognition both on the local and international fronts. The Prestigious Ghana Club 100 ranking has seen the Company move from the 89th position in 2008 to an enviable number one position in 2010.