Kenya's Sasini H1 profit plunges, Rea Vipingo's up
* Sasini's profit tumbles 71 pct to 178 mln shillings
* Rea Vipingo's profit up 33 pct to 302 mln shillings
* Inflationary pressure on costs still a concern
By Kevin Mwanza
NAIROBI, May 24 (Reuters) - Kenyan tea and coffee producer Sasini said on Thursday its first-half profit plunged 71 percent to 178 million shillings ($2.08 million) due to rising input costs and lower international prices despite increased revenues.
Sasini said its basic and diluted earnings per share fell to 0.78 shillings compared with 1.86 shillings in the same period last year, while revenues rose to 1.37 billion shillings from 1.26 billion a year ago.
"The increase in production for both tea and coffee over the previous year was adversely impacted by increase in cost of farm inputs and cost of farm labour," the company said in a statement.
"Auction coffee prices were significantly lower than last year, more than offsetting the gains from more favourable exchange rates."
Earnings from Kenya's main agricultural exports, tea and coffee, rose last year buoyed by a weak shilling that lost a quarter of its value to hit 107 per dollar in October.
The shilling has since recovered helped by an aggressive tightening stance taken by the central bank.
Sasini, which is also involved in dairy farming, horticulture, tourism and retailing, said it would pay an interim dividend of 0.50 shillings per share, same as last year.
Another agricultural firm Rea Vipingo, a sisal producer, posted a 33 percent first-half pretax profit rise to 302 million shillings, due to increased production and higher prices.
The firm, however, warned of the threat posed by inflationary pressure on their operating costs and uncertainty on the international market over the euro crisis in the second half.
"...we do expect to see some tightening of margins during the second half of the year due to inflationary increases in operating costs generally," Company Chairman Oliver Fowler said in a statement.
"It remains to be seen how the situation in Europe will develop and the impact that any major escalation of the crisis could have on the principal markets into which we sell."
The firm, which also runs sisal estates and a mill in Tanzania, said its revenue rose to 1.25 billion shillings from 975 million previously, while its basic and diluted earnings per share rose to 3.47 shillings from 2.56 shillings.
Sasini's shares rose 2.5 percent on Thursday to 12.25 shillings a share, while Rea Vipingo added 1.6 percent to 16.25 shillings. The results came after the market had closed. ($1 = 85.3750 Kenyan shillings) (Editing by George Obulutsa)
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