Profit Up, Cash Out: Unga Group Lifts Net Profit 82.2% but Books Second-Half LossProfit Up, Cash Out: Unga Group Lifts Net Profit 82.2% but Books Second-Half Loss
Key Highlights
- Unga Group lifted net profit 82.2% to KSh 404.56M ($3.11M) in the year to 30 June 2026, while revenue rose 16.5% to KSh 30.45B ($234.34M).
- A first-half profit of KSh 523.17M ($4.03M) was followed by an implied second-half loss of KSh 118.61M ($0.91M), which leaves the recovery looking less secure than the full-year figure suggests.
- Operating cash flow swung to an outflow of KSh 1.48B ($11.39M) from an inflow of KSh 655.94M ($5.05M), and the board recommended no dividend to prioritise reinvestment in capacity and margin recovery.
Unga Group, the Kenyan flour miller, ended its 2026 financial year with a much bigger profit and a much worse cash position, and shareholders will not receive a dividend.
Unga Group reported net profit of KSh 404.56M ($3.11M) for the year to 30 June 2026, up 82.2%, on revenue of KSh 30.45B ($234.34M), which was 16.5% higher than the KSh 26.13B ($201.09M) of the previous year. The headline growth hides a weaker second half and an operating cash outflow more than three times the annual profit. Dollar figures here are converted at KSh 129.94 to the dollar.
A strong first half, then a loss
The first half delivered a profit of KSh 523.17M ($4.03M). With full-year profit at KSh 404.56M, the second half works out as a loss of about KSh 118.61M ($0.91M), on Mwenendo's arithmetic from the two reported figures.
Net profit equals about 1.33% of revenue, a thin margin for a business whose sales grew by double digits. An 82.2% rise also implies profit of roughly KSh 222M ($1.71M) a year earlier, a figure Mwenendo calculated because the prior-year number was not stated in the results material reviewed.
Cash went the wrong way
Operating cash flow was an outflow of KSh 1.48B ($11.39M), against an inflow of KSh 655.94M ($5.05M) in the previous year. Management links the outflow to higher working capital needed to support sales volumes and to supply-chain disruption affecting imported raw materials.
Input and freight costs are part of the backdrop for Kenyan food producers. As Mwenendo earlier reported, transport costs rising 15.6% were the fastest-moving division in September inflation, and Mwenendo earlier reported on how oil jumps reach unga prices through freight and factory inputs.
The company's own explanation, as reported, cites working capital and imported raw materials rather than fuel.
No dividend while capacity comes first
The board recommended no dividend for the year, saying its priority is reinvestment in capacity and margin recovery. For shareholders, that leaves the case for owning the stock resting on whether margins improve and whether the cash outflow reverses as stock is sold, both of which will show in the next set of results.
In Summary
- Who reported the results?
- Unga Group, the Kenyan flour miller.
- What did the company report?
- Net profit of KSh 404.56M ($3.11M), up 82.2%, on revenue of KSh 30.45B ($234.34M), up 16.5%, with an operating cash outflow of KSh 1.48B ($11.39M).
- What period do the results cover?
- The financial year ended 30 June 2026.
- Where does the group operate?
- Kenya is the focus of this report.
- Why did cash flow turn negative?
- Management links the outflow to higher working capital to support sales volumes and to supply-chain disruption affecting imported raw materials.
- How are shareholders affected?
- No dividend was recommended; the board says it is prioritising reinvestment in capacity and margin recovery.