The Managing Director of Uganda Clays Limited, Reuben Tumwebaze, has resigned, bringing to a close a nearly five-year tenure (March 2021–January 2026) defined by heavy capital investment, uneven operating results, and a return to sustained losses.
Multiple sources indicate that the resignation was not entirely voluntary, but came under mounting pressure from the Board, amid growing concern over the company’s financial trajectory.
Tumwebaze’s exit comes against a stark numerical backdrop. During his tenure, Uganda Clays’ total asset base expanded sharply—from UGX 62 billion in 2019 to UGX 78.7 billion by mid-2025—reflecting an aggressive investment and capacity-building programme.
However, profitability peaked early in the period and then deteriorated markedly.
The company has now recorded three consecutive loss-making years, including a UGX 4.95 billion loss in 2024 and a further UGX 1.37 billion loss in the first half of 2025, with no dividends declared since 2021.
In the interim, the Board has appointed the company’s Chief Financial Officer, Jones Muhumuza, as Acting Managing Director, signalling a transition phase focused on financial discipline, cash management, and a reassessment of returns on the substantial capital already deployed.
Five years, one mandate: stabilise
When Tumwebaze took office in March 2021, Uganda Clays was emerging from a fragile period.
Revenue had dipped to UGX 29.7 billion in 2020, but aggressive cost control had delivered a UGX 4.87 billion profit, enabling the company’s last meaningful dividend (UGX 1.35 per share).
His mandate was clear: stabilise operations, restore plant reliability, and manage costs in a kiln-based, energy-intensive manufacturing business—not chase rapid expansion.
The early numbers appeared to vindicate that approach. In 2021, turnover climbed to UGX 36.7 billion, net profit surged to UGX 5.92 billion, total assets rose to about UGX 75 billion, and shareholders received a UGX 1.50 per share dividend—the high-water mark of the Tumwebaze era.
Operational fixes amid structural headwinds
A mechanical engineer by training, with professional ACCA credentials and an MBA, Reuben Tumwebaze approached the leadership of Uganda Clays Limited with a distinctly operational mindset.
His career—shaped by managing multi-million-euro capital expenditure programmes in cement manufacturing and nearly five years at the Uganda National Roads Authority (UNRA) safeguarding national road infrastructure—translated into a management style that prioritised plant uptime, maintenance discipline, tighter inventory controls, and more structured procurement processes.
That approach was reflected in the scale of capital committed during his tenure. Between 2021 and 2024, Uganda Clays continued to expand its balance sheet, with total assets rising from roughly UGX 75 billion to about UGX 76–77 billion, driven largely by machinery acquisitions and capacity investments intended to lift production volumes and improve product quality.
However, this expansion was accompanied by increased borrowing, adding to an already heavy balance-sheet burden that included a long-standing NSSF debt stretching back more than a decade.
As a result, finance costs rose materially, increasingly eroding operating gains.
Even in periods where gross margins showed improvement, higher interest expenses—linked both to legacy obligations and newer facilities taken on to fund capital expenditure—compressed net profitability and limited the company’s ability to translate operational improvements into bottom-line recovery.
These financial pressures were compounded by a challenging operating environment.
The company remained heavily exposed to high power and fuel costs, a persistent structural constraint for kiln-based manufacturing, alongside volatile input prices for transport, spares, and clay handling.
At the same time, demand for building materials remained closely tied to Uganda’s construction cycle, itself highly sensitive to interest rates and the pace of public-sector spending.
Together, these factors created a widening disconnect between balance-sheet growth and earnings performance—one that ultimately sharpened board-level concerns about the sustainability of the turnaround strategy.
From profits to persistent losses
After peaking in 2021, Uganda Clays’ financial performance began to turn decisively downward.
World Bank bans PwC Africa, Rwanda and Kenya affiliates from Bank Group-financed projects over fraudulent practicesIn 2022, turnover held broadly steady at UGX 36.6 billion, but net profit fell sharply to UGX 2.44 billion, signalling early strain in the business model.
That year, dividend payments were halted as cash was redirected toward capital expenditure and capacity investments.
The deterioration became more pronounced in 2023. Revenue declined to UGX 30.4 billion, weighed down by machinery breakdowns and operational disruptions, pushing the company into a UGX 2.85 billion loss.
Notably, this reversal occurred even as total assets remained elevated at around UGX 77 billion, underscoring the growing disconnect between scale and earnings.
Uganda Clays Limited – Financial Performance & Dividends (2019–HY2025)
| Period | Total Turnover (UGX billion) | Net Profit /Loss (UGX billion) | Total Assets (UGX billion) | Dividend Per Share (UGX) | Notes |
| 2019 (FY) | 30.7 | (0.09) | 62 | 0.00 | Cost overruns, machinery downtime; no dividend declared due to loss. |
| 2020 (FY) | 29.7 | 4.87 | 68.8 | 1.35 | COVID year rebound driven by cost cutting; dividend paid in 2021. |
| 2021 (FY) | 36.7 | 5.92 | 75 | 1.5 | Strongest year; peak margins and profitability. |
| 2022 (FY) | 36.6 | 2.44 | 77 | 0.00 | Profitability compresses; capex cycle begins. |
| 2023 (FY) | 30.4 | (2.85) | 77 | 0.00 | Machinery breakdowns; return to losses. |
| 2024 (FY) | 31.6 | (4.95) | 76 | 0.00 | Losses deepen; finance & operating costs surge. |
| HY 1 2025 (6 months) | 15.1 | (1.37) | 78.7 | 0.00 | Margin recovery, but debt & finance costs weigh. |
In 2024, turnover recovered modestly to UGX 31.6 billion, but losses deepened further to UGX 4.95 billion, as rising operating expenses and higher finance costs continued to erode margins.
By the first half of 2025, the trend had not reversed: revenue for the six months stood at UGX 15.1 billion, while the company recorded an additional UGX 1.37 billion loss, despite total assets expanding again to UGX 78.7 billion.
Taken together, the period from 2022 through mid-2025 saw Uganda Clays accumulate losses even as its asset base continued to grow—a structural imbalance that increasingly unsettled the Board and ultimately sharpened pressure for a leadership reset.
Governance pressure and a leadership reset
By late 2025, governance and performance scrutiny had intensified sharply.
Boardroom deliberations increasingly revolved around a fundamental question: were the bold promises that underpinned Uganda Clays’ heavy investment cycle translating into measurable returns?
This question was not abstract. In his July 2023 interview with CEO East Africa Magazine, Tumwebaze had publicly staked the turnaround on a sweeping set of commitments—a new UGX100 billion-capacity tile line, a reconstituted high-calibre executive team, expanded clay reserves, and a revamped route-to-market strategy—confidently framing these as the ingredients of a “better come-back.”
He projected a decisive break from legacy constraints, signalling a pathway from UGX30 billion in 2019 revenue toward UGX72 billion and beyond, with profitability restored and debt obligations, including to NSSF, cleared by 2025.
By the end of 2025, however, the numbers told a more sobering story.
While Uganda Clays’ asset base had expanded to nearly UGX79 billion, the company had recorded three consecutive loss-making years, including a UGX4.95 billion loss in 2024 and a further UGX1.37 billion loss in the first half of 2025.
Dividends—explicitly tied to the turnaround promise—had not been paid since 2021, even as finance and operating costs continued to rise.
Against this backdrop, the Board’s decision to force Tumwebaze to step aside last week marks a clear governance inflexion point.
Operational stabilisation and asset build-up had been achieved to a degree, but the commercial acceleration that had been promised—higher margins, consistent profitability, restored dividends, and visible returns on capital—had not materialised.
For directors increasingly accountable to shareholders, lenders, and long-term investors, the gap between ambition and outcome had become too wide to ignore.
What Tumwebaze leaves behind
Tumwebaze exits after roughly 60 months at the helm, having overseen the company’s largest balance-sheet expansionin years—but also a slide from profitability into sustained losses and a complete halt in dividends after 2021.
As Uganda Clays turns the page under interim leadership, the central question is no longer about stabilising the factory—but whether the next phase can convert a UGX 78.7 billion asset base into durable profitability, and how quickly that can be done in a market where costs remain unforgiving and demand is cyclical.
