The financial woes of the state-owned Cocoa Processing Company Limited (CPC) have deepened, with the firm recording a loss of $9,568,898 million in the first half of 2024, up from $9,155,700 million during the same period last year. This marks a 4.5% surge in losses.
The increase in losses is primarily attributed to escalating operational costs, especially in selling, distribution, and financial expenses.
According to its 2024 Unaudited Financial Statement, CPC’s total revenue for the first half of 2024 declined to $22,198,703, down from $24,184,099 in the first half of 2023, reflecting an 8.2% decrease.
Additionally, the company’s production significantly dropped during the period under review. Cocoa beans processed plummeted to 2,886 metric tonnes from 6,614 metric tonnes in 2023.
Semi-finished products packed fell to 2,239 metric tonnes from 5,425 metric tonnes, and confectionery products packed also declined, recording 1,049 metric tonnes from 1,418 metric tonnes.
To address its mounting challenges and steer towards profitability, CPC has secured a commitment from COCOBOD to continue supplying cocoa beans to meet its operational needs.
Crucially, COCOBOD will not demand repayments in a manner that jeopardizes CPC’s operations.
The Board of Directors has implemented several measures aimed at turning the company around and achieving profitability. These measures include cost-cutting, investing in infrastructure and machinery, and expanding the revenue base.
In a bid to bolster its financial position, CPC’s management is in discussions with the African Export-Import Bank (Afreximbank) to secure an $86.7 million loan facility.
This loan is intended to settle outstanding amounts due to a syndicate of banks, support working capital requirements, and upgrade property, plant, and equipment to expand production capacity.
Management anticipates signing the agreement by December 2024, with the first tranche of the loan to be disbursed by March 2025.