TINASHE MAKICHI
Listed crocodile breeder, Padenga Holdings Limited, says it is expecting a significant reduction in profits for the year to December 31, 2020, relative to prior year owing to the devastating effects of Covid-19 induced lockdown measures across markets.
In a statement to shareholders, Padenga Holdings chairman Thembinkosi Sibanda, warned that they should trade with caution.
He said there were limited sales opportunities for skins not meeting exacting quality standards and when found, sold at very depressed prices particularly for alligator skins from the United States of America based subsidiary Tallow Creek Ranch.
“We believe that our customers will be at the forefront of the market recovery post Covid-19 and that we will play our part in making that happen.
“The net impact of these factors is that the forthcoming results for the financial year ended December 31, 2020 will reflect a significant reduction in profits relative to prior year,” Sibanda said.
Notwithstanding these challenges, both businesses were able to sustain skin supply contracts with premium customers at a time when most crocodilian operations worldwide had no viable market and have ceased operations.
Sibanda further noted that the closure of restaurants across Europe due to Covid-19 induced lockdowns meant that demand for crocodile meat collapsed completely and no export sales were achieved in the period.
The newly acquired Dallaglio mining venture met production and revenue expectations in the period. Padenga acquired Dallaglio, a gold mining operation, in what market watchers said was a fruitful move for the crocodile breeder as gold was a safe investment option on the back of its foreign currency generation capacity. Gold is one of the leading foreign currency earners for Zimbabwe.
Padenga Holdings is the leading supplier of crocodile skins and meat in Zimbabwe, accounting for nearly 85% of the global supply of Nile crocodile skins used for high-end luxury fashion brands.
The company operates three crocodile breeding and production farms in Zimbabwe namely Kariba Crocodile Farm, Ume Crocodile Farm and Nyanya Crocodile Farm. Each farm has the capacity to breed close to 15 000 hatchlings per year.
Nile alligators are bred at Lone Star Alligator Farm in Texas, USA.
