Nana Agyenim Boateng
KWAKU OWUSU Baah, Board Chairman of Cocoa Processing Company (CPC) Limited, has indicated that the company had a serious setback in its profitability and growth as a result of the non-supply and processing of its own cocoa beans.
According to a statement by the board chairman in its 2018/2019 annual reports and financial statements, in the 2017/18 financial year, CPC only received 6,217 metric tonnes of the estimated 24,000 metric tonnes of cocoa beans and another 5,000 metric tonnes in the 2018/19 financial year.
“Despite the shortfall in the beans supply, we are happy to inform you that your company significantly reduced its operational losses. This impressive performance coming on the heels of limited beans supply is an indication of CPC’s potential in contributing to the President’s clarion call to add more value to the country’s cocoa,” it statement.
The 2017/2018 and 2018/2019 financial years saw the CPC struggling to overcome its chronic operational and financial challenges of dealing with its huge losses.
Turnover for its operations, both Cocoa and Confectionery increased from US$14,782,866 to US$28,264,711 for the 2017/2018 and from US$28,264,711 to $28,433,361 for 2018/2019. Turnover increased marginally from US$28.2 million in 2017/2018 to US$28.4 million in 2018/2019, an increase of 0.6%.
He said in view of the losses posted during the years under review as a result of the challenges faced and the huge debt overhung, the board was unable to recommend the payment of dividend for the years 2017/2018 and 2018/2019.
Arrangement With Touton
CPC’s tolling agreement with Touton has had problems lately, basically because it has been very difficult for Touton to secure adequate quantities of the light crop cocoa beans for CPC to process. Several meetings to explore options failed to resolve the matter.
“Accordingly, Touton wrote to CPC requesting for an abrogation of the agreement, and CPC has obliged. Going forward, CPC will now have full access to our processing lines. CPC is now better placed to retooling and rehabilitating our obsolete and old plant and machinery and also securing alternative energy to help reduce our high cost of electricity and energy consumption.”
Looking into the future, the board chairman noted, “We commit to pursuing a total transformation of the company’s machinery and inject funds into our capital structure. Your company will, in addition, continue to introduce new product recipes and adopt a more progressive marketing posture by expanding its marketing outlets to all parts of Ghana as well as identify new foreign markets. The operationalization of the Africa Continental Free Trade Area (AfCFTA) in January 2021 creates an enabling environment for CPC to tap into the over 1.3 billion African population, and we intend to do just that.”
Additionally, he said management and the board would continue to pursue their long-standing intent of paying off CPC’s indebtedness and Capex to retool and replace its obsolete and non-performing machines; invest in its confectionery factory to increase our capacity; construct a CHP to biomass plant to reduce its cost of electricity and energy; introduce new chocolate/confectionery recipes on the market, adding “the company will continue to explore international markets so as to increase our production and consumption base.”