Tanganda bullish about prospects
Tanganda Limited, which relisted on the Zimbabwe Stock Exchange (ZSE) in February this year after a 14-year absence, is bullish about its prospects, to be anchored on internal growth initiatives that entail boosting production of avocados and macadamia nuts.
The company is looking to improve avocado and macadamia yields over the next three to five years. It also expects to reap huge benefits from its investments in solar plants for its estates and new equipment for its Mutare packaging facilities.
The Government policy on export retentions, however, remains a major concern for the company as a significant portion of the company’s business is local and relies on imported materials for its processing and packaging operations.
In the outlook, two opposing factors are expected to affect Tanganda; anticipated global pressures on food prices and the weak growth outlook for the global economy.
The latter is especially a major concern given that exotic teas and coffees are generally considered a luxury.
Commenting on a subdued performance for the half year to March 2022, the company noted that macadamia sales were expected to increase significantly in the second half of the financial year. However, what makes prospects brighter for Tanganda seems to be the firm’s brand value, the infrastructure that is already in place and the potential for growth.
In terms of revenue performance, the company earned $1,9 billion, down 7 percent compared to the same period in 2021. Export sales of $829 million made up 43 percent of total revenues while local sales amounted to $1,1 billion during the period.
Bulk tea production fell by 12 percent to 5,935 tonnes during the period, while export volumes rose by 14 percent to 3,747 tonnes.
Bulk export prices marginally improved to US$1,43 per kg and packed tea exports declined by 10 percent to 933 tonnes. Coffee exports increased by 14 percent to 96 tonnes, while prices realised improved to US$6,67 per kg.
Tanganda posted a net profit before tax of $588,7 million, down 21 percent compared to the same period in 2021. The group realised a negative net cash flow of $86 million, after capital expenditures of $197,3 million and a capital injection of $228,9 million.-The Herald
