Shumba forecasts losses

Shumba Energy expects to report a loss for the period of around $1million to $1.5 million as compared to a profit of $2.7 million recorded in the prior year. According to the group’s financial results for the 12 months ended 30 June 2021, the decrease was mainly due to the once-off item, gain bargain purchase of $4.9 million that was recognised in the corresponding period of June 30, 2020. The expected loss will represent a decline of approximately $3.7 million to $4.2 million a total decline of approximately 137% to 155% as compared to the corresponding period of June 30, 2020. Despite the apparent negative picture of the loss expected to be declared, the company has navigated successfully its most challenging period since its incorporation and listing on the local bourse. The impact of the COVID-19 pandemic causing contractual force-majeure by both commercial partners that provided revenues and margins sufficient to cover operating costs and by investors that have committed to various project developments “within our portfolio” caused significant financial hardships.