TSL Limited after tax profit declined by 26,8% to $4,9 million for the year ended October 31 2014 due to a significant drop in contribution from associated companies.
In the same period in 2013, after tax profit was $6,8 million.
In the period under review, turnover grew by 19% to $ 48,2 million and operating profit was up 4% to $ 7,3 million.
TSL chief executive officer Washington Matsaira told an analysts briefing last week that operating profit grew by 4% due to margin pressures in the hessian business and higher than expected start-up costs for the new trading division.
“We believe the positive 4% growth in operating profit is a satisfactory result and the major contributor to the decline is largely due to a weak contribution from associate companies,” Matsaira said.
In the period under review sector performance, Bak logistic recorded a 7% growth in revenue with growth mainly in the general cargo and distribution division.
On tobacco operations, Matsaira said the company revenue grew by 16% while operating profit went up by 19% underpinned by a growth in the company’s market share to 50% and expansion in the services on offer to tobacco farmers.
“Sound revenue and profit performance in 2014 clearly riding on the back of a bigger crop. Market leader position increased by 10% to 50% of auction volumes and the 22% of the revenue is from handling contracts and growing,” Matsaira said.
During the period under review, the group recorded a target production of 3,6 million kg.
Propak Hessian achieved a 24% increase in revenue, Agricura revenue surpassed the prior year by 10%.
On real estate business, Matsaira said TSL Properties recorded a growth largely driven by a strong demand for warehousing space and third party tenants improved by 8% to 33%.
He, however, said the group has plans to establish an industrial park at its property near the Boka Tobacco Auction Floor, which was expected to be completed in five years.
Matsaira said Cut Rag Processors Limited’s performance fell below expectations and Nampak Zimbabwe Limited formerly Hunyani Holdings Limited profit’s contribution to the group fell below the prior year.
“Looking forward, we will continue to focus on creating sustainable value through the established clusters, that is, Logistics, Agriculture, Real Estate and Trading,” Matsaira said.