Reduced irrigation as a result of low dam levels in the 2017/18 season saw sugar production for the six months ending 30 September tumble to 140 174 tons compared to 155 522 tons for the same period last, a decrease of 10%, according to Hippo Valley Estates latest results.
Group chairperson, Hector Munro, the group results for the six months period ended 30 September 2017 show an operating profit of $8,0 million, a significant improvement from the $3,9 million achieved for the same period last year, largely on account of an improved mix resulting from increased local sugar sales volume relative to exports.
“Sugar production for the period to 30 September 2017 amounted to 140 174 tons compared to 155 522 tons for the same period last year, a decrease of 10%.
“This was due to the late start of the milling season and the resultant lower cane deliveries to the mill over the six month period amounting to 1 081 640 tons compared to 1 165 432 tons delivered in the same period last year, a decrease of 7%.
“The Company’s cane deliveries amounted to 575 482 tons (2016: 663 949 tons), a decrease of 13%, while the private farmers collectively delivered 506 158 tons of cane, a marginal increase from the 501 483 tons delivered in 2016.
“The overall volume of cane deliveries to the mill has been negatively impacted by lower cane yields due to the poor growing conditions precipitated by the restricted irrigation water availability due to lower dam levels prior to the onset of the rains in December 2016,” said Munro.
He added that total revenue for the six month period ending 30 September 2017 decreased by 13%.
“Total revenue for the six months period to 30 September 2017 amounted to US$72,4 million (2016: US$82,9 million), a decrease of 13%,” said Munro.
According to Hippo Valley Estates half year results ending 30 September 2017, total industry sales volumes for the period to 30 September 2017 amounted to 218 896 tons (2016: 257 356 tons), a decrease of 15%.
The report further noted that as a result of the improved mix in the proportion of local sales relative to exports, the operating profit and profit for the period amounting to US$8,0 million and US$5,6 million was above prior period of US$3,9 million and US$1,4 million respectively.
