Africa-Press – Eswatini. The Royal Eswatini Sugar Corporation Limited (RES)’s total comprehensive income attributed to the owners of the company amounted to E222.4 million by the end of September.
According to the company’s condensed interim results for six months ended in September, this was 57 per cent lower than the results achieved for the period to September 2021.
The statement explained that this decrease was due to the lower sugar in an inherently high fixed cost environment, as well as the impact of global inflationary pressures due to the on-going Russia-Ukraine war affecting all oil-linked commodities such as diesel and agrochemicals.
It was mentioned that the cane crushed, at 2.1 million tonnes, was 20 per cent lower than in the same period last year.
“This is primarily due to curtailed harvesting operations on account of unprecedented high winter rains. The area harvested was 26 per cent lower than for the same period last year. While a return to normal production levels had been anticipated for the current season, cane yields have not reached their potential,” the statement highlighted.
It was explained that the estate sucrose yields which was tonnes sucrose per hectare (ts/ha), showed slight improvement at 13.43 ts/ha compared to 13.27 ts/ha for the same period last year.
“The current year crop has been negatively affected by adverse climatic conditions that included low radiation during the peak growing period, cane lodging on substantial areas of the estate, cane quality degradation on ripened fields due to the interrupted winter harvesting operations, and a conducive climate for pests and disease infestation,” read the statement.
Sugar production according to the statement was consequently 23 per cent lower at 271 221 tonnes, 96° pol sugar, as compared to 351 310 tonnes, 96° pol sugar for the same period last year and ethanol production at 14.3 million litres was 12 per cent lower than the production in the same period last year.
“This is due to lower production resulting from lower molasses availability and using one distillation plant while the other one was being upgraded, Ethanol sales at 12.2 million litres were 14 per cent higher than the prior comparative period due to scheduled sales ex stock,” the statement highlighted.
It was mentioned that due to the seasonal nature of the business, whereby the crushing season ends in December and the expected results for the second six months will be significantly lower than those recorded in the first six months.
Sugar production might be higher
Sugar production for the current year is expected to be marginally higher than the prior year due to cane yield potential being impacted by different events.
According to RES based on current crop estimates and above normal rainfall predictions for the remainder of the harvesting season, the results for the full year are expected to be modestly lower than the prior year.
“The group continues to improve efficiencies in its pursuit to be a low cost producer of sugar. A number of projects on growth and efficiency are on-going to ensure sustainability of the group,” read the statement.
It was mentioned that the group was committed to best corporate governance practices and in this regard it was guided on a voluntary basis by the King IV code of corporate governance best practices and other international guidelines.
“Details of the group’s compliance with corporate govemance are set out in the March integrated report and these have been consistently applied during the six month period,” read the statement.
According to the statement, the first interim dividend for the year ending March 31, 2023 (dividend 61) of 53.5 cents per share was declared on September 16 and was paid in November to shareholders who were registered in the books of the company at the close of business on October 16.
For More News And Analysis About Eswatini Follow Africa-Press
