PTC Group Sacco profit grew by a tepid 0.31 percent to K7.47 million in the year ended December 2013 from K7.45 million, a situation the group’s chairperson Jallon Mweya attributed to rising costs and employees dismissals.
The profit growth was announced at the group’s annual general meeting (AGM) on Saturday in Blantyre, the first for all the Savings and Credit Cooperatives (Saccos) in the Southern Region, a feat an official from Malawi Union of Savings and Credit Cooperatives (Muscco) described as commendable.
As a result of this profit, the savings and credit cooperative that comprises some employees in the Press Corporations Limited (PCL) group will pay out a dividend of K5.5 million with the other chunk to be kept with their mother body, Muscco as reserves, according to legal requirement.
“A lot of issues affected the profit, one of which is the environment in which we were operating in. A lot of costs have gone up.
“Members are joining and at the same time they are pulling out because of dismissals and retrenchments from the mother company which, as a Sacco, we cannot do anything because it is controlled by the employers,” he said in an interview on the sidelines of the group’s AGM.
But Mweya said looking at the performance for the first quarter (Q1) of this year, they will surpass last year’s profit.
According to the financial results, the group’s assets that include investment in unlisted shares, investment in Treasury Bills (T-bills), and member loans, jumped 21.3 percent to K91 million from the previous year’s K76 million.
The group with a membership of 1 405, an increase from 1 376 the year before, saw its finance costs rising by 26 percent to K71 572 from 56 962.
However, what is worrying is the rise in delinquencies or the inability of the group’s members to pay back the loans, which has risen by 90 percent to K1.1 million in the year ended December 2013 from K629 220.
Going forward, Mweya said they have come up with a five-year strategic plan which will among others, result in the rebranding of the group to reflect the diversity of membership from PCL and other companies.
A representative of Muscco, Gloria Chisakasa, commended PTC Group Sacco for being the first to hold an AGM this year, saying other groups are still struggling to have their books audited.
She said according to the requirement, Sacco are supposed to hold an AGM within three months after the end of the financial year.
In an environment in which commercial bankinterest rates are out of reach of many, Saccos have over the years proved to be an avenue through which most Malawians access loans with flexible terms.
Last year, Muscco chief executive officer Sylvester Kadzola advised Saccos to attract more members to ensure that they grow their profits.