Agro-industrial concern Tanganda Tea Company Limited which relisted on the ZSE in February this year after parting ways with parent company Meikles Limited has declared a maiden interim dividend to its shareholders of ZWL 50 cents per share likely to boost confidence in the company at a time some listed entities are withholding spoils for working capital.
Tanganda was initially listed in 1963 and remained listed until 2008 when it delisted following the merger with Kingdom Financial Holdings, Cotton Printers and Meikles Africa Limited.
In its interim financial results for the six months to March, group revenue was 53 percent up in historical terms to ZW$ 1.664 billion due to a combination of strong locals sales recovery and firming average selling prices for exported bulk tea and coffee.
The export average selling price for bulk tea slightly firmed to US$1.43 per kg from prior year average selling price of US$1.41 per kg as coffee exports of 96 tonnes that were 14 percent above 84 tonnes achieved in prior year also realised growth in average export selling price to US$6.67 per kg from US$6.50 prior year.
“The Company is realizing the benefit of its diversified operations,” said the group, which has also taken up bottled water, macademia nuts and avocado production.
“Timing of revenue recognition from export of macadamia nuts has resulted in the seeming decline in revenue. The macadamia export market is gravitating towards kernel instead of the traditional nut in shell and the revenue from these exports will be recognized in the second half of the financial year,” it said.
Despite incurring increased operational costs of ZW$ 519.6 million which were 114% higher than previous year in line with rising inflation, the group managed to post a profit before tax of ZWL 1.265 billion from ZWL 929 million in the prior year.
A net profit for the six months ZW$ 1.048 billion was subsequently realized.
The group said yields of avocado and macadamia are expected to increase with enhanced maturity profiling of plantations over the next three to five years.
On capital projects, the solar plants constructed at three of the five estates have significantly reduced reliance on power from the national grid.
“Further benefits from the investment are expected to be fully realized once full reticulation and net metering have been implemented before the end of 2022,” said the group.
