LIVINGSTONE MARUFU
Agro-industrial concern, Ariston Holdings says the disposal of Claremont Orchards Holdings (Private) Limited weighed down on its performance in the quarter to December.
Ariston disposed 50% of its shareholding in Claremont to a Dutch company Tuinbouw Zonder Grenzen BV (TZG) for about US$2m to fund its macadamia nut orchards in Chipinge and Chimanimani districts in Manicaland Province.
The group received proceeds from the disposal of 50% of its shareholding in Claremont Orchards Holdings (Private) Limited to Tuinbouw Zonder Grenzen BV in the first quarter.
“Revenue for the first quarter declined by 19% compared to the prior comparative period as a result of the absence of pome fruit and stone fruit which were no longer part of the product portfolio for the group going forward as a result of consummation of the disposal of 50% of Claremont Orchards Holdings (Pvt) Ltd,” Ariston company secretary Acquiline Chinamo said in a statement.
Chinamo said the weather in the reviewed period was cooler than prior year, rains were less and very late, with most rains only being received at the tail end of December 2021.
In Chipinge and Chimanimani where the majority of Ariston operations are located , about 172mm of rain had been received in the first quarter to December 31 2021 compared to 532 mm received in the prior comparative period.
“Operations in Chipinge and Chimanimani were relatively least affected by the changes in weather pattern. Irrigation was available but was adversely affected by power cuts. Operations at Kent Estate were more affected as the dryland planting could only be completed in late December 2021,”she said.
Crops under irrigation at Kent were unaffected by the late rains.
Chinamo said the effect of the late rains on dryland crops will be lower than optimum yields on dryland crops but improvements in selling prices are expected to make up for any decline in yield.
The delayed rainfall coupled with power cuts experienced in the current period resulted in decline in tea production levels in the first quarter.
Chinamo said macadamia volumes were 20% ahead of the prior comparative period with harvesting beginning in March hence the minimal production levels.
Poultry is produced on an out-grower model for the largest poultry producer in Zimbabwe. In the current period, the producer increased the number of placements thus resulting in higher production volumes.
Other products consist of potatoes, commercial maize, seed maize, soya beans, sugar beans and bananas.
The category has continued to grow over the years with increasing significance to the group’s revenue and positive contribution to the group’s profitability.
The continual growth is due to increased hectarage as well as improved production efficiencies.
The group has continued to invest in more irrigation for this category thereby increasing the number of crops and times the fields are utilised in a year.
The decline in tea sales volumes was mainly due to a decrease in export tea volumes caused by subdued global economic activity as a result of the Covid-19 pandemic and global shortage of shipping containers.
As a result, 83% of tea sales were made to the local market.
The group closed the fourth quarter of 2021 with some macadamia nut stocks.
The sale of these in the first quarter of 2022 resulted in the increase in sales volumes in the current period compared to the comparative prior period where most stocks had been sold prior to year-end.
Poultry sales were in line with production volumes as these are raised on a contract model.
Sales of other products were higher than production due to the sale of seed maize and seed sugar beans which were going through quality processes at year end of 2021.
Chinamo said the effect of the pandemic on the group has mainly been felt in the constraints being encountered by shipping lines such as shortage of shipping containers for export product as well as for importation of materials required by the group, shipping delays for both exports and imports and any lockdowns legislated globally slows down economic activity and demand for products.
