Harare – Sugar refiner, Starafrica Corporation which manufactures and markets sugar-based products under two well-known brand names, Goldstar Sugar and Country Choice Foods, achieved a Profit Before Tax of $0.5 million against a Loss Before Tax of $1.3 million incurred in the comparative period, for the half year ended September 30, 2018.
The PBT which is the first since the adoption of multi- currency economy in 2009 was achieved on the back of improved EBITDA and the reduction in interest payable on long term loans after significant debt to equity conversions that took place close to the end of the previous financial year.
The Group’s sugar sales in terms of volumes increased by 18 percent from 30 328 tonnes in prior year comparative period to 35 697 tonnes in the half year under review.
The increase in volumes also resulted in turnover increasing by 21 percent from $23.2 million in the same period last year to $27.9 million in the period under review.
The Earnings Before Interest, Tax, Depreciation and Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) grew by 13 percent to $2.1 million, and EBITDA margin erosion was a result of steep and repeated price increases that were experienced in certain cost lines including packaging, repairs and maintenance, materials and process reagents.
The Group said 35 791 tonnes of refined sugar was produced during the period under review, marking a 5 369 tonnes improvement from the previous comparable period.
In the period under review, Tongaat Hulett Botswana the associate company in Botswana performed significantly above prior year levels as it achieved a profit after tax growth of 63.6 percent to $1.8 million.
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