- Tea production volumes increased from 821 tonnes to 941 tonnes
- Revenue increased by 98%
- FY21 earnings predicted ahead of prior year
HARARE – In a period clouded by global economic downturn and a volatile local economy amidst the COVID-19 pandemic, diversified agro-industrial concern, Ariston saw improvement in tea production and sales, with revenue predominantly foreign currency-denominated highlighting a booming export business.
The local economy continues to be adversely affected by local currency inflationary pressures, the decline in disposable income, while both the domestic and global economic activity has been heavily impacted by the ongoing pandemic.
In a trading update for the first quarter ended 31 December 2020 (Q1 FY21), the Group said tea production volumes increased from 821 tonnes to 941 tonnes due to more favorable weather patterns compared to prior years.
“In the 1st quarter of 2021 demand for export tea improved resulting in the Group’s stockholdings being depleted,” The Group said.
“There was marginal improvement in selling prices. Local tea sales also increased compared to prior year.”
Ariston agriculture operations also include macadamia, maize apples, banana and it has poultry and beef cattle. According to the Group, the favorable weather patterns allowed for the production of 32 tonnes of Commercial Maize in the first quarter, while there has also been an increase in poultry production and a 65% increase in banana production.
“Sales of macadamia, fruit, poultry and maize are in line with both the prior period and the production volumes,” the Group said.
Revenue for the period under review increased by 98% in inflation-adjusted terms, owing to the sharp increase in sales of tea, fruit, and maize. The Group said that revenue remains predominantly foreign currency denominated.
Commenting on the impact of COVID-19 on operations, the Group said that the lockdown measures introduced by Government in January 2021 have had a very negative impact on the sale of fresh fruit.
“Accordingly, a disproportionately larger volume of stone fruit has had to be sent to processors at reduced selling prices.”
The Group said that all the Estates are operational during the lockdown period as they are classified as essential services and as such, harvesting and production are progressing well, with volumes predicted to be ahead of the prior year.
“The Board and management, therefore, believe that the Group’s financial results for the year ending 30 September 2021 will be more favorable than those achieved for the year ended 30 September 2020,” the Group said.
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