Kakuzi has reported a 15 per cent decline in its half-year net profit, with the company attributing the drop to low avocado valuations and weakening global tea prices that eroded earnings.

The Nairobi Securities Exchange-listed agribusiness firm said net profit for the six months ended June fell to Sh295.54 million, down from Sh347.5 million in a similar period last year.

Gross earnings also reduced to Sh409.6 million from Sh486 million.

According to the firm’s financial statement released on Wednesday, avocado earnings dipped to Sh395 million from Sh951 million, following lower crop valuations.

During the review period, the company exported 165 containers (801,840 cartons) of avocados to Europe, where it faced stiff competition from Peru, South Africa, and Colombia.

The company’s tea business posted a wider loss of Sh27.5 million, compared to Sh3.5 million last year, as global tea prices remained subdued. Analysts say the global market has been hit by oversupply, sluggish demand, and the weakening of the Kenyan shilling.

The World Bank has also projected that tea prices are likely to fall further next year, a situation expected to exert more pressure on Kenyan producers.

Despite the challenges, Kakuzi recorded improved results in its macadamia and blueberry segments.

The macadamia division delivered a profit of Sh319 million, a sharp increase from Sh32 million last year, buoyed by strong global demand and better pricing.

Blueberries also turned profitable, earning Sh13 million compared to a Sh17 million loss last year.

Overall, Kakuzi’s total revenue for the half-year rose to Sh1.51 billion from Sh1.17 billion recorded in 2024.

Speaking when he confirmed the half-year trading results, Kakuzi managing director Chris Flowers said the firm has put in place strategies to support growth amid the tough operating climate.

“The year-to-date trading in our two core crops is in line with expectations. The international avocado market has been well supplied, with price levels reflecting this situation,” Flowers said.

He added that shipping route disruptions experienced earlier this year are easing.

“The earlier experienced shipping route challenges are also beginning to stabilise with an increasing number of voyages returning to the Red Sea routing,” he said.