“In Zimbabwe, operational optimisation at the Triangle refinery has increased production of refined sugar suitable for domestic industrial markets,” said South African-headquartered Tongaat Hullet Ltd in its interim results for the six months to September 30, 2017
Tongaat Hulett’s sugar operationsin Zimbabwe comprise the wholly owned Triangle Sugar operation and its 50, 3 percent holding in Hippo Valley Estates.
The group said the Zimbabwean operations’ operating profit for the period under review rose by 42, 6 percent to R358 million from the prior comparable period last year, and attributed this to “increased local sugar sales”.
The Zimbabwe sugar operating profit increased to R358 million (2016: R251 million). Local market sugar sales increased, including volumes for refined white sugar.
“Sugar production is expected to be lower than last year due to the impact of low dam levels in 2016 that led to restricted irrigation in the key growing period for this season’s crop.
“The current half-year results include the higher milling portion of the division of proceeds, which was adjusted late in the 2016/17 year as part of an ongoing process,” it said.
Management said the 2017/18 crop in Zimbabwe and Mozambique will continue to be impacted, to varying extents, by the reduced irrigation and limited replanting that was necessary during 2016.
It added that the current dam levels, following the good rains at the end of 2016 into 2017, are providing full irrigation during 2017/18 leading to a significant crop recovery by 2018/19.
“There has been significant success in Zimbabwe and Mozambique with the required protection from imports, with Government support, given the high rural job impact of these industries and being in line with international norms,” said Tongaat Hullet.
Meanwhile, the group’s revenue for the period under review of R8, 118 billion was -4, 5 percent lower from 2016’s R8,503 billion.Operating profit of R1, 471 billion was 9 percent up from R1, 350 billion in the prior comparable period. The group posted headline earnings of R661 million.