Nelson Gahadza
Senior Business Reporter
Zimbabwe’s record national tobacco output for the 2023 season boosted TSL’s performance after the group’s tobacco-related businesses achieved strong growth in three months to July 2023.
The company’s inflation-adjusted revenue for the third quarter ended July 31, 2023, rose 229 percent to $66,8 billion from $20,3 billion in the same period last year, driven by strong volume growth, particularly in tobacco, TSL said in a quarterly update.
According to the Tobacco Industry and Marketing Board (TIMB), output reached a record 294 million kg, or 44 percent ahead of the prior year.
TSL runs a tobacco auction facility, the second largest in the country and a printing and packaging plant.
It is also involved in the supply of agricultural inputs, storage, logistics, and real estate.
“The US dollar portion of revenue for the quarter grew by 47 percent when compared to the prior year, and profitability continued to grow, driven by improved operating efficiencies and increased capacity utilization,” the company said.
The tobacco sales floor handled 51,9 million kg, a 125 percent increase from 23,1 million kg in the same quarter last year.
“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 decentralization of operations, and the acquisition of new customers,” the company said.
Propak Hessian volumes were 17 percent ahead of the prior year owing to stock availability and a larger tobacco crop size.
Tobacco paper volumes were 90 percent ahead of the prior year.
Agricura’s performance for the quarter was mixed. TSL said while some product lines performed better than the previous year on the back of product availability and competitive pricing, other lines were lower than budget due to depressed demand.
TSL said the new business model for its logistics operations, which supports the customers throughout the value chain, resulted in an increase in volumes across the divisions.
It said 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.”
The company said clearing and forwarding volumes remained strong due to improved volumes.
“General cargo handling volumes were buoyed by product movements to Zambia through the Beira corridor,” said TSL.