Chronicle Editor
Oliver Kazunga, Senior Business Reporter
STARAFRICA Corporation says its sugar processing unit, Goldstar Sugars Harare (GSSH), has registered a 46 percent increase in sales volume to 39 294 tonnes in the half year ended September 30, 2021.
In statement accompanying financial results for the period under review, Starafrica Corporation attributed the spike in sales volume during the period under review to broad capital investment and equipment maintenance plan.
“As a result of the comprehensive capital investment and equipment maintenance plan, GSSH sold 39 294 tonnes against 26 959 tonnes sold in the prior year comparative period,” said the company.
“This 46 percent improvement in sales was possible due to the demand for white refined sugar in the market, which remains high.
“However, unlike in the prior comparative period, no export sales were recorded in the period under review as all production was absorbed in the domestic market with demand still heavily outstripping supply.”
It said 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, were expected to augment throughput in the second half of the year to fully satisfy local demand.
Water supply to the plant was adversely affected by supply side constraints from the Harare City Council resulting in a disproportionately higher amount of water being sourced from private suppliers, which pushed production costs upwards.
Electricity supply, though marginally improved from the prior year comparative period, remained erratic largely due to electrical faults.
Starafrica Corporation is also in the process of rehabilitating a raw sugar warehouse which will be able to hold 15 000 tonnes of raw sugar.
“The rehabilitation of the raw sugar warehouse, which was razed down by a fire last year, is well underway and expected to be completed by end of March 2022.
“Once completed, the structure will be able to house 15 000 tonnes of raw sugar which will assist in supporting efforts to increase productivity through stable inlet of the primary raw material into production.
“The plant continued to be certified by The Coca Cola Company (TCCC) as well as Food Safety Certification under the FSSC 22000 series,” said Starafrica Corporation.
This enables the group to supply products to TCCC franchisees in the Southern Africa region and beyond.
Turning to its scheme of arrangement, whose tenure expires in 2022, the group said the scheme remains in place with 99,9 percent of creditors having been settled.
“During the period under review an amount equivalent to $654 451 was made as a final payment to an offshore creditor, which extinguished the last of the group’s foreign currency denominated obligations.
“Efforts to trace the whereabouts of the few remaining local scheme creditors are ongoing,” it said.
In terms of financial performance, the group registered a notable increase in turnover in the period under review from $2,84 billion to $3,92 billion, translating to a 38 percent increase.
The escalation was largely buoyed by the enhanced throughput and the strength of the demand for all its products, which remained high during the period under review.
“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,” said the company.
“The group’s earnings before interest, tax, depreciation, and amortisation also grew by 20 percent from $482,10 million in the prior year comparative period to $579,68 million in the six months ended 30 September 2021.” – @KazungaOliver
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