PBC targets 40% share of Ghana cocoa market next two years

The Produce Buying Company (PBC), a licensed cocoa buying firm, expects to boost its market share to 40 per cent in the next two years despite the stiff competition in the Ghanaian industry.

The company, which last year returned a market share of 37 per cent, said it is ready to put in more effort to outsmart the other 25 Licensed Buying Companies.

Speaking at the Facts Behind the Figures programme on the Ghana Stock Exchange, Mr Kojo Atta-Krah, Managing Director of PBC, said despite the impressive performance last year, the company’s market share dropped to 37 per cent

This, he said, was as a result of the stiff competition within the industry, adding it was the avowed aim of the board and management to command a 40 per cent share within the next two years.

Turnover for cocoa operations increased from GH¢622.644 million to GH¢1.285 billion, an increase of 106 per cent due to high producer price, buyers take over margin and volume of cocoa purchased and delivered.

The company also increased its cocoa purchases by 56.8 per cent to 374,858 tonnes from 238,967 tonnes, leading to a profit before tax of GH¢37.434 million as against GH¢19.256 million in 2010.

Mr Atta-Krah said finance costs have been a major item affecting revenue and the potential profitability of the company and that last year alone more than 25 per cent of gross operational earnings were used as net finance expenses.

In this direction, he said, the board and management were considering accessing offshore facilities at a lower cost to supplement the local funding sources to bring the finance cost to a more comfortable level.

The company will also explore the possibility of raising funds through the stock market for cocoa purchases.

Mr Atta-Krah assured investors that the company would continue to improve operational efficiency, improve storage and other warehousing facilities, increase Information Communication Technology access in the company and motivate staff through training, bonus and other incentives schemes.

“We assure shareholders of the most reliable and constructive management practices to continue to keep their company in good standing and improve earnings,” he added.

Mr Joseph Osei-Manu, Deputy Managing Director, Finance and Administration, said net finance expenses increased by 87.8 per cent to GH¢34.564 million from GH¢18.402 million mainly as a result of increase in the quantum of monies utilised in the year’s operations following the jump in cocoa purchases.

The company, he said, paid GH¢2 million dividend to government and GH¢7.565 million as corporate tax to the Ghana Revenue Authority.

Source: GNA

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