The financial troubles of the state-owned Cocoa Processing Company Limited (CPC) have worsened, as the company reported a loss of $9.57 million in the first half of 2024. This is an increase from the $9.16 million loss recorded in the same period last year, representing a 4.5% rise in losses.
This increase is mainly due to rising operational costs, including expenses related to selling, distribution, and financial management.
According to the 2024 Unaudited Financial Statement, CPC’s total revenue for the first half of 2024 fell to $22.20 million, down from $24.18 million in the first half of 2023, marking an 8.2% decrease.
Production levels have also sharply declined. Cocoa beans processed dropped to 2,886 metric tonnes from 6,614 metric tonnes in 2023. The amount of semi-finished products packed fell to 2,239 metric tonnes from 5,425 metric tonnes, while confectionery products packed decreased to 1,049 metric tonnes from 1,418 metric tonnes.
To address these challenges and work towards profitability, CPC has secured a commitment from COCOBOD to continue supplying cocoa beans necessary for its operations. Importantly, COCOBOD has agreed not to demand repayment in a way that would disrupt CPC’s activities.
The Board of Directors has initiated several strategies to turn the company around, including reducing costs, investing in infrastructure and machinery, and expanding revenue sources.
Additionally, CPC’s management is negotiating with the African Export-Import Bank (Afreximbank) for an $86.7 million loan facility. This loan aims to settle outstanding debts with a consortium of banks, support working capital needs, and upgrade property, plant, and equipment to boost production capacity.
The management expects to finalize the loan agreement by December 2024, with the first portion of the loan anticipated to be disbursed by March 2025.
