TSL revenue jumps 61 percent
Listed agro and logistics firm TSL said revenue for the third quarter ending July 31, 2022 was 61 percent ahead of prior year in inflation adjusted terms.
Company secretary, Fadzayi Pedzisayi in a trading update said; “The operations remain profitable, and the group continues to prioritise the preservation of shareholder value. The group continued to build on its strong foundation and actively pursued its “Moving Agriculture” strategy.”
However, she said, gearing remained low with adequate interest cover and the business will continue to monitor its local currency exposures in the light of recent economic and monetary developments.
In terms of operations, Tobacco Sales Floor (TSF) cumulatively handled 23,1 million kgs of tobacco against 24,3 million kgs in the previous year which represents a 5 percent decline year on year.
“The strategy to serve the much larger contracted tobacco market is yielding fruits, with 62 percent of the total volumes handled coming from this segment,” Pedzisayi said.
In the quarter under review TSL successfully opened a new floor in Mvurwi and the volumes therefrom were pleasing and this complemented the business’ decentralized operations in Karoi, Marondera and Harare. Propak Hessian volumes came in 15 percent below prior year owing to a reduced national crop and a change in the timing of collection of packaging materials by merchants.
Pedzisayi said, “This gap is expected to narrow in the fourth quarter. The new tobacco paper manufacturing line, which was commissioned in December 2021 produced a high quality, competitively priced paper that the market responded to positively.”
As a result, Propack saw its paper volumes consequently grow by 24 percent in the period under review.
TSL said Agricura’s performance for the quarter was mixed as some product lines performed better than the previous year on the back of product availability and competitive pricing whilst other product lines were not available as a result of inordinately long lead times as a result of global supply chain disruptions. The agro group said these products will however be on hand for the coming summer cropping season and hope for a better performance of the division.
In the farming operations, better yields were achieved compared to the previous year on tobacco, seed maize, soya bean and commercial maize. The improved water and weather conditions resulted in banana plantation production growing by 50 percent.
In the logistics sector, the introduction of a reliable rail service between Harare and Maputo since August 2021, in partnership with DP World and Unitrans, continued to increase volumes in the Ports business. As a result, this is expected to grow as the business commenced a rail service for exporters during the quarter.
“Premier Forklift volumes were 5 percent ahead of prior year due to additional business from new clients. Forklift sales also significantly increased in the quarter as more clients resumed capital expenditure which was previously deferred,” Pedzisayi added.
In the period under review, Avis’ rental days were materially ahead of prior year as lockdown restrictions continued easing.
Real estate operations in the quarter saw certain properties deliberately kept vacant for redevelopment in the later part of the financial year.
“Consequently, the level of voids remains satisfactory. Additional warehousing space is currently under construction in response to existing demand and is expected to be added to the property portfolio in the coming financial year,” Pedzisayi concluded.
In their outlook, the group said it will continue to pursue its stated key strategic objectives and position itself appropriately to ensure shareholder value is continuously created and preserved.-ebusinessweekly
