Tanganda volumes bulk 45 pc
The country’s leading tea and coffee producer, Tanganda Tea Company Limited’s revenue for the third quarter to June 30, 2023 jumped 45 percent to $32 billion compared to $22 billion during the same period in the prior year.
For the nine-month period, the firm achieved a $100 billion revenue, which was 65 percent ahead of prior year period on firm demand despite the challenging operating environment.
The period under review was characterised by inflationary pressures, currency volatility and rapid changes in the policy environment.
“Pricing of products and credit terms have been affected by exchange rate volatility coupled with fluctuations in market liquidity. However, we anticipate the resultant value chain pricing distortions to self-correct over the ensuing period as players run down stocks,” said Tanganda in a trading update for the quarter under review.
Profit after tax went down 10 percent on the back of subdued plantation crops volumes, although this is expected to improve next year as avocados come out of the biennial phenomenon.
The company has revealed bulk tea production fell 4 percent on prior year figures due to the late onset of the rainy season. Resultantly, exports went down 12 percent for the segment.
Packed tea sales experienced a 7 percent dip as the rapid decline in local currency resulted in volumes declines as some major customers decreasing. According to the company, more strategies continue to be deployed to develop alternative trading channels.
Tanganda revealed that macadamia production was in line with prior year. Macadamia marketing season commenced earlier than prior year with 260 tonnes of current year crop already exported in addition to 475 tonnes that had remained unsold at the end of the prior year.
Avocado production went down 38 percent on prior year production figures due to biennial phenomenon coupled with the impact of extensive pruning carried out on 55 hectares of mature trees to rejuvenate them. According to the company, revenue from export of avocadoes is expected to be recognized during the last quarter of the financial year.
Despite the challenging operating environment, which is seen continuing in the short to medium term, Tanganda still remains upbeat of improving on its profitability supported by value addition projects that are in the pipeline, cost containment and market confidence.
The company is also banking on enhance productivity following improved power supplies as the company invested in solar power, which has also cut on cost of power. This has coincided with increased power supplies from national grid.
“Fortunately, power from the national grid to the operations improved in June 2023 and the future looks promising from both our own solar system investment and improvements in supply from national utility,” said Tanganda.-businessweekly
