Strong demand spurs starafricacorporation
RYAN CHIGOCHE
Listed sugar processor, starafricacorporation says huge demand for its products spurred the company’s stellar performance in the six months to September 30, 2021.
The company bounced back to profitability in the period under review reporting a profit of ZWL$116.7m compared to a loss of ZWL$ 81.4m in the same period the previous year.
Turnover increased 38% to ZWL$3.92bn from ZWL$2.84 bn.
The company’s acting board chairman Rungamo Mbire attributed the positive results to a strong local demand.
“The escalation was largely buoyed by the enhanced throughput at Goldstar Sugars and the strength of the demand for all the group’s products which remained high during the period under review,” Mbire said.
“The improved turnover is also a recovery from the prior year’s depressed performance which had been caused by a three week shutdown in operations between July and August 2020 because of a Covid-19 incident that had occurred at the Harare Refinery.”
Contributing immensely to the profitability Goldstar Sugars Harare unit recorded a 46% improvement in sales having sold 39,294 tonnes against 26,959 tonnes sold in the prior year.
As demand heavily outstripped supply the company did not record any export sales during the period unlike the previous comparable period.
The procurement and commissioning of two new centrifugal machines, an effluent treatment plant, an injector pump, coupled with the rigorous plant maintenance regime that has been put into effect during the reported period, are expected to augment throughput in the second half of the year to fully satisfy local demand and probably feed the export market.
He Country Choice Foods unit products continued to dominate during the reported period after they had implemented a successful cost leadership strategy that has positioned its products among the most affordable in the market.
Sales volumes for the unit increased by a laudable 27% from the previous comparable period.
The procurement and commissioning of the syrup filling machine and the icing packing machine in the second half of the year are expected to further boost production at the unit through automation of some production processes.
In the reviewed period the unit launched new products into the market namely, chocolate, lemon and mint icing and bun and bread premixes which expanded the product portfolio.
Of all the units, the starafricacorporation properties business unit was the only one which made very little movement during the period under review.
The revenues of this business unit remained largely stagnant with ZWL$12.5m compared to the ZWL$12.4m in the prior year comparative period with unit’s growth stalled by the adverse effects of the Covid-19 pandemic.
In the outlook, starafricacorporation is confident of preserving the gains made as it focuses on sustained improvements across all units.
Mbire said the company will continue utilising the foreign currency auction system to obtain cash to secure critical raw materials, among others.
