PPADB turns down Sefalana payment

Keikantse Lesemela
Friday, 21 April 2017
PPADB turns down Sefalana payment

Company supplied gov’t with Tsabana,Malutu
We remain govt’ supplier-Osman

Sefalana, the diversified group has suffered a setback as government  public procurement and awarding body, PPADB has not approved request by the local government to pay the listed its  dues after a successful delivery, BG Business understands.

The company’s subsidiary which has a milling plant in Serowe, Foods Botswana, was chosen to supply 4020 metric tons of Malutu and 4920 metric tons of Tsabana to the Local Government ministry, which is ministered by Slumber Tsogwane.

At its sitting on the 31st of March 2017, Public Procurement and Asset Disposal Board (PPADB) did not approve the retroactive payment to the company, which its financial year ends next week. PPADB which is headed by Bridget John has not stated reasons for the rejection.  The non-payment is likely to affect the BSE listed company’s financial results.  Foods Botswana manufactures Malutu and Tsabana which government issues out to local clinics and health facilities across the country.

Meanwhile, Sefalana Group Finance Director, Mohammed Osman told BG Business that they have completed their 2015/16 government tender in April 2016 which was extended by six months to October 2016.  “We are proud to have delivered all allocated volumes on time to the government. We now await the award of the 2016/17 tender, which is currently under consideration,” he said.

Although he could not disclose how much is the payment BG Business understands that the government had allocated P15.6 million for the supply of 1640 metric tons of Tsabana. “At this moment we can not share with you how much we are supposed to get from government.

We have, since the PPADB decision was made public in the newspaper, made enquiries with the respective department and are still engaging with them to find out what needs to be done to move forward,” said Osman. The Sefalana finance chief said he believes that the matter will be amicably sorted out in due course. Foods Botswana. “We remain a supplier to government and continue to supply the respective department,” he said. Announcing the 2015 results last year Sefalana Managing Director, Chandra Chauhan said they experience a net loss of P2, 5 to P3 million if they don’t produce for government. The group’s revenue is largely hinged on its contract/tender business than it is on its core segment of fast moving consumer goods (FMCG).

According to the group’s financials, the group recorded a turnover of P2.005 billion for the six months ended October 31, 2016 up from P1.8 billion in the prior period. The group’s overall profit before tax for the six month period increased marginally to P81.1 million from P80.4 million recorded in the previous year.

Sefalana Cash and Carry Limited Botswana operations contributed 60 percent and 48 percent of the group’s revenue and profit before tax for the reporting period.

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