Press Corporation Limited Plc is to sell its 20% stake in Castel Malawi Limited.
The Malawi Stock Exchange–MSE listed conglomerate disclosed this in its financial statements for the year 2020.
In the financial report, the group has hinted on divesting its remaining 20% stake in the company at 12million US dollars or MK9 billion.
The Malawi Stock Exchange listed conglomerate posted a MK19.9 billion profit in 2020, which is 13% lower than what it made in 2019.
It has attributed the subdued performance to have been further negatively impacted by a 90% decline in profit from equity accounted investments.
This is largely due to losses incurred in the Beverage and Bottling Company, occasioned by an exchange loss amounting to MK6.36 billion.
In respect to the mentioned business, PCL has indicated that after assessing the various operational and regulatory issues that continue to negatively affect Castel Malawi Limited, directors concluded that it would be in the best interest of the Group to divest its remaining 20% stake in the company.
Negotiations to that effect have now been concluded at a price of USD12 million or (9.3billion kwacha) and that the proceeds will be realized this year 2021.
In segmental performance, the Financial Services Segment which mainly consists of National Bank of Malawi produced strong results with a 31% growth in its profit after tax.
Its telecommunications segment saw TNM registering a 46% decline in its profit after tax while its fixed line company continued to make losses, albeit, lower than last year.
Meanwhile, its energy segment, Press Cane and Ethco, continue to deliver excellent results and registering a 116% growth in post-tax profit.
This was mainly driven by improved margins following the agreement of a new pricing model with the Malawi Energy Regulatory Authority.
However, the struggling Consumer Goods Segment operating as PTC continued to make losses, attributed to working capital constraints, which also undermine the implementation of their revised strategic plan.