AGRI-PROCESSING firm Tongaat Hulett says its Zimbabwean unit recorded a 25% drop in revenue in the year ended March 31, 2014 due to lower market sales on the back of rising imports.
BUSINESS REPORTER
In the period under review, revenue was R2,89 billion down from R3,2 billion recorded in the same period last year.
The dip in revenue took a toll on operating profit which went down 55% to $33 million from the $74 million recorded in the year comparable.
The Zimbabwe operations — comprising the wholly-owned Triangle and 50,3% shareholding in Hippo Valley Estates — maintained its second spot in terms of output.
At 488 000 tonnes of sugar in the period under review, Zimbabwe was behind South Africa operations (634 000), Mozambique (249 000) and Swaziland (53 000).
Keep Reading
- Chamisa under fire over US$120K donation
- Mavhunga puts DeMbare into Chibuku quarterfinals
- Pension funds bet on Cabora Bassa oilfields
- Councils defy govt fire tender directive
Tongaat Hulett said the past year had seen considerable increases in wage rates, particularly at the lower levels where the majority of man hours are worked, as well as price increases for bought-in goods and services.
“Notwithstanding this, significant success has been achieved to reduce the cost of sugar production in respect of goods, services, transport, marketing, salaries and wages. The unit cost of production in South Africa reflected the benefit of volume growth with limited cost increases,” it said.
The Zimbabwe operations recorded a reduction in the cost of bought-in goods and services, salaries and wages by $40 million in the period under review. In the outlook, Tongaat Hulett was hopeful on measures instituted in Zimbabwe “to protect local market against unfair import competition” to yield benefits.
Last month, government suspended the importation of all agricultural produce and cancelled all existing import permits, a move local producers say would increase the uptake of their produce.
Vegetables and fruits among others from South had flooded major supermarkets elbowing out local produce.