ZIMBABWE Stock Exchange-listed conglomerate, Meikles Limited says it suffered huge price cuts on its avocado exports to Europe after the market shrunk in the during of the COVID-19 pandemic.
BY FIDELITY MHLANGA
A fresh wave of infections have been sweeping across the globe, forcing governments to close hotels, restaurants and impose new restrictions.
Priority has shifted to protecting citizens from potential contagion, at the expense of saving economies.
Meikles said yesterday that these drastic actions by governments precipitated a sharp slide in avocado exports.
After selling off its iconic Meikles Hotel in the Harare’s CBD, Meikles is now mostly agro-focused.
“Volume of avocado export sales grew by 52% to 1 450 tonnes in the comparative period,” Meikles chairman John Moxon said in a statement accompanying financial results for the half year ended September 30, 2020.
“However due to lockdowns in Europe that resulted in massive closure of restaurants and hotels, the avocado average selling price declined 37% from US$1,62 per kg in the half year ended 30 September 2019 to US$1,02 per kg for the six months ended 30 September 2020.”
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Moxon said tea exports of 3 282 tonnes were 11% lower than 3 669 tonnes sold during the comparable period last year.
Average international bulk tea exports price for the period retreated to US$1,35 per kg from US$1,47 per kg during the prior comparable period. Bulk tea production was also affected by adverse weather.
Moxon said macadamia production declined by 37% from 854 tonnes previously, to 537 tonnes as a result of drought and failure to irrigate crops due to power outages.
However, the average price of primary grades of US$5,37 was 8% firmer than those obtaining previously.
He said the group’s flagship supermarket chain, TM Pick ‘n Pay, reported an inflation adjusted revenue of $10 billion, down from $10,8 billion.
The segment lost trading days as branches closed for disinfection following detection of COVID-19 cases.
“Despite constraints brought about by COVID-19, the segment opened a new store in Aspindale, Harare in July 2020. Work is at an advanced stage for another new branch in Harare that should be opened before end of December 2020.
“The store in Hwange was closed for major renovations and will reopen before end of December 2020 under the Pick ‘n Pay brand,” Moxon said.
The group’s revenue of $11,2 billion retreated by 8% compared to the previous year due to COVID-19-induced decline in sales volumes.
Operating profit from continuing operations was $660,4 million from $1,1 billion.
Group profit after tax was $189 million, down from $2,1 billion previously.
The hospitality segment, now comprising sorely of Victoria Falls Hotel, a partnership with African Sun, was affected during the period under review as international tourism and travel was disrupted by the pandemic.
Moxon said hotels reopened on November 1.
“Our current focus is on the refurbishment roll-out that is scheduled to commence at the beginning of 2021,” Moxon said.
Operating profit for the property was $33,3 million compared to $154,3 million for previous period. Most of the firms that have reported for the period have indicated that operations were severely affected by the pandemic.
