By: Benjamin Nii Nai Anyetei
The Cocoa Processing Company (CPC) suffered a severe deterioration in its financial performance in 2025, with operating revenue plunging by 46.87 per cent and net losses widening to GH¢144.06 million, raising fresh concerns about the company’s financial viability.
According to the 2025 State Ownership Report by the State Interests and Governance Authority (SIGA), CPC’s operating revenue fell from GH¢481.88 million in 2024 to GH¢256.01 million in 2025.
The sharp fall in revenue was not matched by a corresponding reduction in the company’s cost base, resulting in a significant deterioration in its operating performance.
CPC’s operating loss more than doubled from GH¢41.22 million in 2024 to GH¢92.65 million in 2025.
Loss before tax and net loss both increased from GH¢99.12 million to GH¢144.06 million, representing a 45.44 per cent deterioration.
The company’s operating profit margin consequently worsened from negative 8.55 per cent to negative 36.19 per cent, while its net profit margin fell from negative 20.56 per cent to negative 56.27 per cent.
In practical terms, CPC lost more than 56 pesewas for every GH¢1 of revenue generated during the year.
SIGA said the scale of the revenue decline could point to a structural demand or market shock, with possible factors including the loss of cocoa-processing contracts, lower export volumes or changes in global cocoa market prices.
The report said management would need to identify and address the underlying causes of the revenue decline to restore the company’s financial viability.
Equity rapidly eroded
The deterioration in earnings also had a major impact on CPC’s capital position.
Total equity fell by 62.35 per cent, from GH¢300.71 million in 2024 to GH¢113.22 million in 2025, as accumulated losses continued to erode the company’s capital base.
At the same time, total assets declined by 13.87 per cent from approximately GH¢2.15 billion to GH¢1.85 billion.
CPC’s total liabilities stood at GH¢1.73 billion in 2025, compared with GH¢1.85 billion a year earlier.
This pushed its debt-to-asset ratio from 86 per cent to 94 per cent, meaning liabilities financed approximately 94 per cent of the company’s assets, leaving equity to finance only about six per cent.
SIGA described CPC’s capital structure as highly leveraged and financially fragile, warning that the shrinking equity buffer could threaten the company’s long-term stability.
Return on equity deteriorated sharply from negative 32.94 per cent to negative 127.24 per cent, while return on assets worsened from negative 1.92 per cent to negative 5.01 per cent.
Liquidity pressures persist
CPC also continued to face significant liquidity challenges.
Its current ratio improved marginally from 0.23 in 2024 to 0.25 in 2025 but remained substantially below the generally accepted benchmark of 2.0.
The ratio indicates that the company’s current assets remained insufficient to cover its short-term liabilities.
Operating cash flow also declined from GH¢61.85 million to GH¢51.78 million.
Although the operating cash flow-to-revenue ratio improved from 0.13 to 0.20, this was largely because revenue declined at a faster rate than operating cash flow.
The short-term debt coverage ratio, however, fell from 4.21 per cent to 3.64 per cent, signalling weaker capacity to meet short-term obligations using cash generated from operations.
Processing capacity under pressure
Established in 1965, CPC processes cocoa beans into semi-finished products including cocoa liquor, cocoa butter, cocoa cake and cocoa powder.
The company also produces Golden Tree chocolate bars, chocolate-coated peanuts, drinking chocolate, chocolate spread and other confectionery products.
Its factories have a combined processing capacity of about 65,000 metric tonnes of cocoa beans annually.
However, the 2025 financial results highlight significant challenges for the state-owned processor, with declining revenue, deepening losses, a shrinking equity base and high leverage placing pressure on its ability to sustain operations.
SIGA said reversing the revenue decline and rebuilding the company’s financial position would be critical to restoring CPC’s long-term viability.
