By FRANK MUKUPA
SUGAR production for the 2018/19 farming season increased to 400,000 tonnes from 353,000 tonnes in the previous season, Zambia Sugar company secretary Mwansa Mulumba Mutimushi has said.
“Cane supply and quality have been trending above that of the past three years mainly due to improved bulk water supply and infield irrigation, increased area due to better farming practices and improved field specific nutrition programmes,” Ms Mutimushi said.
He said this in the annual report.
Ms Mutimushi said the domestic market performance had continued on the positive trajectory largely driven by continued optimisation of route to consumer to enhance market penetration.
This is also as a result of availability and optimisation of products portfolio to ensure needs of all consumers segments were met.
“Despite growth being recorded in regional market sales, performance continues to be impacted by the surplus world sugar supply which has resulted significant volumes of world market sugar finding its way into the region affecting demand and putting pressure on margins,” she said
She said proactive measures taken to reset the cost base through the implementation of a project called project 400 had a positive impact on half year earnings.
Ms Mutimushi said total revenue for the six-month period up to February 28, 2019 was K1.219 billion, 14 percent above the comparative period of K1.065 billion mainly due to improved cane supply and higher sales demand.
“Operating profit for six-month period was K190 million compared to the K150 million operating profit in the comparative period. This is mainly driven by the higher net revenue, increased production levels and strict cost control measures in place,” she said
Ms Mutimushi said headline earnings for the six-month period ended February 2019 was K30 million, 68 percent above the comparative period at K18 million
The outlook for the second half, she said, was expected to take a turn with economic uncertainty increased regulation and the introduction of the sales tax putting pressure on margins.