‘Shift in tobacco auctioning season to affect performance’

The delay in the opening of the tobacco marketing season by a month will impact negatively in the half year performance of TSL Limited, chief executive officer, Washington Matsaira has said.



The tobacco marketing season is starting on March 30. In previous years, the season began in February.

Speaking at the company annual general meeting in Harare yesterday, Matsaira said the auction floors’ opening was moved back by a month, while output was projected to be down by between 20% and 30%.

“[The] half year performance will be impacted by slower activity in, agriculture cluster and shift in the tobacco auctioning season. Overally, performance will remain satisfactory,” he

Matsaira said the uptake of key agro-chemicals and fertilisers was subdued due to the El Nino
weather effect.

He, however, said the group was now focusing on improving agronomy support and new marketing initiatives and pricing mixes were introduced.

Matsaira said the group was anticipating good yields for maize, soya and tobacco and the prices were expected to be firm.

He said the logistics cluster continued to perform well in a difficult environment, the
properties cluster faced margin pressures, but occupancies remained strong, while the agriculture cluster performance was impacted by the El Nino-induced drought.

“Logistic operations’ overall performance remains solid, distribution and general cargo
volumes were adversely impacted by slower economy,” Matsaira said.

He said the forklift business experienced margin pressures, the impact of internal and external forces on the company’s profitability, but performance remained satisfactory and the group was focusing on expanding its customer base.

On the real estate operations, he said financial performance continues to be steady, occupancies solid, with voids at fewer than 5% and the drive to grow third party tenancy continues.

According to the group’s annual report for 2015, the agriculture season was particularly difficult due to erratic rainfall, while national tobacco production was down 8% to 199 million kg from 216 million kg.

Profit before tax, associates and joint ventures was unchanged on prior year. Profit before tax declined by 11% to $6,1 million.

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