New model results in increased tobacco volumes

Listed agro and logistics firm TSL says a combination of a larger national tobacco crop, successful decentralisation of operations and the acquisition of new customers contributed to it cumulatively handling 51,9 million kilogrammes of tobacco — a 125 percent increase on prior year’s 23,1 million kilogrammes

The group also indicated that its new business model, which supports the customer throughout the value chain, resulted in an increase in volumes across the logistics’ divisions.

Company secretary, Fadzayi Pedzisayi in a trading update for the third quarter ended 31 July said “The new business model, which supports the customer throughout the value chain, resulted in an increase in volumes across the logistics’ divisions.

Tobacco

“Tobacco handling volumes were significantly ahead of the prior year due to an increase in the customer base.

“The rail service from both Maputo and Beira has continued to operate and performance in the quarter was satisfactory.”

In the agriculture operations, the Tobacco Sales Floor cumulatively handled 51,9 million kgs of tobacco – a 125 percent increase on prior year’s 23,1 million kgs.

“The strategy to serve the much larger contracted tobacco market is yielding fruit, with 75 percent of the total volumes handled coming from this segment.

“These positive results are, in large measure, attributable to a larger national tobacco crop, successful decentralisation of operations and the acquisition of new customers.”

In the period under review, clearing and forwarding volumes remained strong due to improved volumes from customers.

The firm said general cargo handling volumes were buoyed by product movements to Zambia via the Beira corridor.

In the logistics sector, Premier Forklift volumes were 17 percent ahead of the prior year as the business continues to grow its volumes from both new and existing clients.

Tobacco paper volumes were 90 percent ahead of prior year as the market has continued to respond positively to the locally coated paper.

The firm said Agricura’s performance for the quarter was mixed.

“While some product lines performed better than the previous year on the back of product availability and competitive pricing, other product lines were lower than budget due to depressed demand.”

Turning to the business performance, the group revenue for the quarter at $66,8 billion was 229 percent ahead of the prior year of $20.3 billion in inflation adjusted terms driven by strong volume growth, particularly in the tobacco-related businesses.

The US dollar portion of revenue for the quarter grew by 47 percent when compared to the prior year.

It noted that profitability continued to grow, driven by improved operating efficiencies and increased capacity utilisation. roup borrowings are foreign currency denominated and remain low with adequate interest cover.

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