Limuru Tea Company, a stalwart in the tea industry, has raised the alarm bells by issuing a profit warning for the financial year concluding on December 31, 2023.

The company foresees a substantial decline of more than 25 per cent in profit, a downturn attributed predominantly to escalating operational costs.

In a candid admission, the company's Chairperson, Dorcas Muli, outlined on the factors contributing to this anticipated financial setback.

Muli pointed towards the exorbitant costs associated with importing fertilizers, a factor that has significantly strained the company's financial standing.

Moreover, the depreciation of the Kenyan shilling has further exacerbated the financial predicament, casting a shadow on the company's profitability.

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The financial gloom is not solely confined to external economic factors; rather, Limuru Tea Company anticipates a consequential hit due to the projected loss in biological asset valuation from the preceding year.

The intricacies of these financial dynamics have led the company to project a profit dip of more than a quarter, marking a substantial setback for its shareholders.

"Based on preliminary review of the financial statements of the Company, the company is expected to record a decline of more than 25 per cent in profit before tax attributable to the shareholders of the company for the year ending 31 December 2023," affirmed  Muli in an official statement.

In an added twist to the narrative, the company also attributes its financial woes to the burgeoning cost of labour, a revelation that sheds light on the multifaceted challenges faced by Limuru Tea Company.

The confluence of these factors underscores the intricacies and challenges pervasive in the tea industry, mirroring the broader economic landscape.

Shareholders and industry observers are now keenly awaiting the detailed financial report to gain deeper insights into the specific metrics contributing to the decline.

As Limuru Tea Company braces for the impact, the revelations serve as a cautionary tale for stakeholders, prompting a closer examination of the economic factors influencing the profitability of businesses in Kenya's tea sector.