East African Portlands Cement has announced plans to lay off its workers due to financial problems the cement firm is facing
In a memo signed by acting Managing Director Stephen Nthei, the company says it will declare all positions redundant and employees released.
Over the last six years, the performance of the company has continued to decline leading to daily losses of up to Sh8 million. In the last three years, the company’s market share has also reduced drastically affecting negatively on sales and profitability.
“The company is now faced with the need to restructure its operations, which will include a staff rationalization programme to balance our running costs and current levels of productivity,” says the acting managing director, Stephen Nthei.
The employees, however, will be encouraged to apply for subsequently reconfigured positions.
“We take this opportunity to request a meeting to discuss this process with all staff on Frida August 16 as we acknowledge that the exercise will be a difficult decision but the best option in the present business circumstances.”
In March this year Industrialisation Cabinet Secretary Peter Munya said the Government had already started laying the groundwork for the revival of the company, including the change of management and modernising its ageing plant in Athi River.
He said the cement manufacturer, which had indicated that it requires at least Sh15 billion to stay afloat, has the potential to stand on its feet again if it gets the said cash injection.
“We as the Government are kin on reviving EAPCC and we have carried out due diligence on the existing loopholes leading to the losses,’’ said the CS.
He said the planned sale of the pioneer cement manufacturer’s land alone would not be enough to pull it out of its current financial woes, having posted a Sh1.26 billion loss for the half-year to December last year.
According to its financial results, the firm, however, managed to restructure some of its loans, which reduced finance costs by 53 per cent from Sh313 million in 2017 to Sh204 million to December last year.
