Online Reporter
Michael Tome
Business Reporter
Ariston Holdings says it is banking on the growing demand for macadamia nuts as global demand continues to surge following the Covid-19 induced oversupply.
According to the company’s indications, the global macadamia oversupply that arose during the Covid-19 pandemic has now ended, and the market is currently under-supplied. As a result, buyers from around the world are increasingly seeking to secure off-take agreements for the upcoming season.
Ariston’s production volumes for the year to September 2024 grew three per cent year-on-year to 1 395 tonnes. The company had 1,219 tonnes of macadamia nuts available for sale, including prior year’s unsold stock and managed to sell 246 tonnes of kernel equivalent (Ristonuts).
Notably, the average selling price improved by 13 percent during the year, indicating strong demand for macadamia nuts in the post-Covid-19 era.
Ariston’s CEO, Mr Leon Nortier, expressed confidence in the company’s ability to tap into the growing global demand. He highlighted that the company’s macadamia orchards have a better nut set than in the previous comparative period, positioning Ariston to capitalise on the favourable market conditions.
With elevated macadamia export prices expected for the 2024/2025 season, the company is well-placed to take advantage of the opportunities presented by the current market dynamics.
“Indications are that the global macadamia oversupply situation that arose during the Covid-19 period has now come to an end, with the market being under-supplied,” said Mr Nortier. “Increasingly, buyers are now trying to secure off-take agreements for the upcoming season. The Group will continue to focus on quality, production efficiencies and cost-cutting measures in order to maximise shareholder value.”
These developments come as the Group acquired a macadamia scanning machine, which allows for the scanning of nut-in-shell macadamia nuts to determine their quality before export. This advanced equipment enables the company to effectively grade and price its macadamia nuts, guaranteeing the quality being sold to international buyers. The scanning machine was commissioned in April 2024, just in time for the macadamia selling season.
The combination of increased production volumes, better pricing and strong joint venture performance has driven Ariston’s revenue growth.
For the year ending September 30, 2024, Ariston’s revenue grew nine percent year-on-year to US$7,1 million. This was attributed mainly to improved macadamia volumes and selling prices and positive performance from the three current joint ventures which contributed positively to the Group’s financial performance.
“The three joint ventures, namely Bonemarrow Investments (Private) Limited trading as Claremont Powerstation, Claremont Orchards Holdings (Private) Limited and Mombe Shoma (Private) Limited, contributed positively to the Group’s financial performance,” said Ariston group chairman, Mr Alexander Jongwe.
With its enhanced capabilities, Ariston is well-positioned to continue delivering strong financial performance in the future.
Despite the revenue growth, Ariston’s cost of sales increased by three percent due to higher costs of essential inputs such as fertilisers, crop chemicals, and electricity.
This rise in production costs outweighed the benefits of increased revenue, resulting in a gross loss of US$1 389 028 for the year ending September 30, 2024.
The increase in input costs, particularly for fertilisers, crop chemicals and electricity, has squeezed the company’s profit margins. This highlights the challenges faced by agricultural businesses like Ariston, where external factors such as global commodity prices and local utility costs can significantly impact financial performance.
