Agriculture and Agribusiness Tongaat Hulett continued to make steady progress in implementing its turnaround strategy and putting the group back on a sustainable growth path.
During the half-year ended September 30, the group experienced strong local demand in all sugar activities and achieved good market share gains.
However, the company said on December 6 that the interim period “presented several additional hurdles to navigate,” such as hyperinflationary effects and higher input costs in Zimbabwe, a disappointing grinding performance in South Africa due to maintenance delays linked to Covid, as well as significant challenges and losses linked to the civil riots in South Africa in July.
All of these challenges also weighed on the income and profits of the real estate business, although the hurdles were countered by “much lower finance charges” which Tongaat said contributed to the growth in the group’s pre-tax profit. over the period of more than 20%.
However, during the period the effective tax rate for the period was 97% due to the lack of provision of deferred tax assets for tax losses in South Africa and the net monetary loss not deductible; and since the majority of profits are generated in Zimbabwe, and interest and taxes are borne in South Africa, Tongaat’s profit share for the period is negative.
Taking all this into account, Tongaat on Monday said it would report a loss of Rand 224 million for the period, which equates to a loss of a Rand 1.66 share.
His overall loss for the period would be around 175 million Rand, or 1.30 Rand per share.
The publication of the interim results is scheduled for December 9.