TSL Limited says the year 2025 cemented its turnaround towards strong growth, underpinned by a rebound in volumes, improved operational efficiency and a buoyant tobacco season that lifted performance across its diversified business portfolio.
Benefiting from a record national tobacco crop and tighter cost control, the diversified agribusiness group translated higher activity levels into stronger revenues, improved profitability and a healthier balance sheet.
Group chief executive, Mr Dereck Odoteye, told an analyst briefing for the group’s financial results for the year to October 2025 that performance was closely linked to a record year for Zimbabwe’s tobacco industry, which provided a solid foundation for growth.
“From the tobacco industry perspective, the industry achieved a record, the highest in the country at the end of last month, of 255 million kilograms, up 53 percent on the previous year, and as an industry, we generated US$1,2 billion,” he said.
He said while the average selling price eased slightly to US$3,32 per kilogramme, about two percent lower than the prior year, the sharp increase in volumes more than compensated for the price drop, resulting in favourable yields across the value chain.
“Resultantly, TSL delivered a 24 percent increase in revenue to US$45,6 million, up from US$36,9 million in the prior year, supported by a strong 2024-2025 tobacco season and broad-based volume growth across all business units,” said Mr Odoteye.
“What you will see is that we generated more cash in the current year. We reduced our financial risk. We strengthened our balance sheet. And more importantly, we rewarded our shareholders,” he said.
For the year under review, EBITDA rose 70 percent to US$19,3 million from US$11,4 million, while operating profit climbed 80 percent to US$16,2 million. Profit after tax from continuing operations surged 84 percent to US$10,5 million, compared with US$5,7 million a year earlier.
Mr Odoteye said the improvement in profitability was driven by higher revenues arising from increased volumes, complemented by ongoing cost optimisation initiatives implemented over the past two years.
“Additional support came from fair value gains and property disposals, with US$2,5 million in after-tax fair value gains recognised during the year, alongside US$1,1 million generated from the disposal of two properties,” he said.
Mr Odoteye said TSL also made progress in de-risking its balance sheet after interest cover improved by 54 percent to 10,35 times, while gearing declined from 18 percent to 13 percent.
“Debt levels fell by 21 percent to US$8,5 million, and cash balances increased fivefold to US$8,6 million at year-end,” he said.
Operationally, the growth narrative was evident across individual business units. In the agricultural business unit, volumes grew across most product lines despite late rains and intense competition.
“In agricultural trading, the fungicide volumes surged 167 percent following the introduction of new products, fertiliser volumes increased 137 percent and animal health remedy volumes jumped 218 percent, reflecting the impact of a new animal health plant commissioned in November 2024,” said Mr Odoteye.
However, he noted that insecticide and herbicide volumes declined by 34 percent and 35 percent, respectively, prompting branch rationalisation, product mix adjustments and reduced funding of low-margin generic products.
The packaging business, Propak Hessian, recorded a 26 percent increase in sales volumes, benefiting from higher national tobacco output; however, tobacco paper volumes declined six percent overall, with strong local demand offset by lower export volumes.
In the tobacco-related services, auctioneering and marketing business, Tobacco Sales Floor (TSM), volumes handled increased 56 percent to a record 81 million kilograms, up from 52 million kilograms previously.
Mr Odoteye said all sales floors in Harare, Mvurwi, Karoi and Marondera recorded growth, supported by good grower participation, merchant support and the acquisition of new customers.
“The group also continued to decentralise and automate operations to align costs with activity levels,” he said.
On the ZMX commodity exchange, growth was modest, with warehouse receipts rising two percent to US$77,6 million, covering about 195 082 tonnes of commodities, mainly maize and wheat.
Mr Odoteye said trade finance facilities of US$23 million were put in place to enhance liquidity and support future trading volumes.
The logistics unit, Bak Logistics, delivered improved performance, with forwarding volumes up 107 percent due to higher utilisation of project warehouse facilities.
General warehouse utilisation rose to 21 percent, and forklift hours increased 11 percent, although inland port container volumes declined earlier in the year due to reduced rail movements before recovering later.
In the infrastructure business, third-party tenant income rose 51 percent following the full-year contribution of a 15 000 square metre warehouse. Occupancy levels remained stable at 87 percent, while net yields improved by 10 percent.
Mr Odoteye said TSL will also commence the development of its 73-hectare land bank in Harare South in the second quarter of the 2026 financial year.
He said upon completion, the project is expected to deliver approximately 1 900 residential stands, together with commercial stands and other community amenities.
The group will also prioritise the operationalisation of the Rutenga multimodal inland port, following the successful completion of all regulatory approval requirements.-herald
