Business
ILLOVO registers MK6.1 billion net profit
May 24, 2021 / Wahard Betha
Sugar group IllovoMalawi Plc has registered a net profit of Mk6.1 billion for the six months’ period to February 28, 2021, compared to MK2.0 billion that the company made for the corresponding six months to February 29, 2020.
In an unaudited financial statement for the six months, Illovo explains that despite being hit by Covid-19 challenges, company sales revenue remained relatively flat with six-month sugar and molasses sales totaling MK74.5 billion.
Reads the statement co-signed by Chairman Gavin Dalgliesh and MD Lekani Katandula: “Both factories completed their crushing seasons in December 2020 with agricultural operations performing well in terms of cane yields and overall sucrose content from both own and smallholder farmers cane.”
“Investment in drip irrigation at Nchalo delivered improvements in cane yield in line with targets.
“Engagement continued with the Government on the need to dissuade the rampant smuggling of sugar and other products.”
The statement also said in January 2021 the company experienced very dry weather which triggered high irrigation demand and a rise in aphid infestations.
It says good rainfall at both factories received in February 2021 partly helped to relieve the dry conditions.
Milling operations for both factories achieved consistently high throughputs prior to closure of their crushing seasons and commenced their respective off crop maintenance programs in December 2020.
It says the programs were completed successfully and both plants resumed production in mid-April this year.
States Dalgliesh and Katandula: “Despite the domestic market being under significant pressure through a combination of general instability, a slowing economy exacerbated by the Covid-19 pandemic, currency depreciation and influx of informal imports, domestic sugar sales reflected a welcome return to more normal levels supported by active marketing and logistics improvement initiatives and sustenance of our reduced domestic pricing since mid-December 2019.”
“Export sales revenues were however below expectations with covid-19 hampering both inter-continental and intra Africa exports.”
“Quality remained a key focus area to ensure superior delivery of our customer experience.”
The company has generated operating profit of MK10.6 billion against MK5.0 billion the company made for the last period.
Despite the hiccups that the company faced in the last period, Illovo eyes improvements in terms of agricultural production and electricity supply.
According to the statement, it is envisaged that there will be a return to more stable weather patterns in the next six-month period.
It says: “With regard to the commercial environment, the business will continue to build on the successful route to consumer initiative with a focus on product pack sizes, branding, affordability and quality.”
“Sugar exports, in what is expected to be very challenging markets, will also continue to be an area of attention for the commercial teams especially in light of the receding Covid-19 induced logistical challenges as global vaccination programs gather momentum.”
“The interplay of stable domestic inflation, moderate exchange rate depreciation, stable interest rates and improved national food supplies could provide a platform for a better second half provided that there are no further covid-19 related downsides.”
It also says Illovo has embarked on various initiatives that will help to improve cane crop yields, plant reliability and people productivity across the business value chain.
The initiatives include: the ongoing factory recovery improvement; optimal use of field irrigation systems; standardizing sound agronomic practices and; embedding of the workforce transition project.
Share this:
Leave a Comment
Comments
Mining & Trade Review News
Agribusiness News
Subscribe to Newsletter
Rehabilitation:
The establishment of a stable and self-sustaining ecosystem, but not necessarily the one that existed before mining began. In many cases, complete restoration may be impossible, but successful remediation, reclamation, and rehabilitation can result in the timely establishment of a functional ecosystem.
Archives
Remediation:
The cleanup of the contaminated area to safe levels by removing or isolating contaminants. At mine sites, remediation often consists of isolating contaminated material in pre-existing tailings storage facilities, capping tailings and waste rock stockpiles with clean topsoil, and collecting and treating any contaminated mine water if necessary.
Stakeholders Logos
