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This research report was prepared by the Research Department of Old Mutual Securities Limited. Old Mutual Securities Limited is a securities trading company licensed by the Capital Markets Authority (Kenya) for the purpose of facilitating trade on the Nairobi Securities Exchange.

Here are our views on the news making headlines today for Kenya:
Kenya's struggling Mumias Sugar names new CEO. Mumias said Errol Johnston, who previously headed the company from 1998 to 2001, would take over from 1st August 2015. He is credited with establishment of a major cane development programme for both the company’s nuclear plantation and its farmers.

Our View: This might be a temporary boost to the company which has been faced with a myriad of challenges, key among them the unreliable supply of raw materials due to a cane shortage that is blamed on non-payment of farmers and collapse of extension services. Other risks to the company include overreliance in rain fed sugarcane, capacity underutilization, illegal sugar import and the expiry of COMESA deadlines.
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