HARARE, December 15 (The Source) – Sugar processor Star Africa Corporation’s operating loss narrowed 84 percent in the six month period to September 30, from $1,98 million incurred last year to $314,397, driven by significant improvement in production, efficiencies and sales, the company said on Thursday.
Revenue rose by 117 percent in the six months to September 30 from $6,6 million last year to $14,3 million.
Loss after tax decreased by 37,74 percent from $5,3 million last year to a loss of $3,3 million.
“The reduction in losses was due to improved production at Gold Star Sugars Harare (GSSH), improved profits at Country Choice Foods (CCF) and the disposal of Bluestar Logistics which was making losses”, said company chairman, Joe Mutizwa.
Finance costs recorded in the period under review increased from $2,6 million incurred last year to $2,9 million as a result of compound interest on debt which remained unpaid over the period.
The tonnes of refined sugar produced by GSSH increased by 243 percent in the six month period to September 30 from 5,184 tonnes last year to 17,756 tonnes on the back of improved efficiencies in the plant.
Despite cut-throat competition from imported products and local substitutes, Country Choice Foods’ operating profit increased by 62 percent to $214,910 in the period under review from $133,005 realised in the same period previous year.
The company said earlier in February, their consultants Global Canesugar Services (Private) Limited (GCS) of India integrated the upgraded section of GSSH Plant with the old section of the plant at Goldstar Sugars Harare (GSSH), a move that saw throughput increasing to 400 tonnes per day and improve the quality of sugar.
Mutizwa said the firm expects to reap the fruits of the good quality sugar that the plant is producing, which meets all market segment requirements and the company also expects to leverage on sugar supply contracts concluded with major industrial customers.
The sugar processor also hopes that the secondary scheme of arrangement which the company put in place with its creditors will relieve cash flow problems and, coupled with the refurbishment of the plant at GSSH, the company expects improvement in terms of profitability in the full year.
Additionally, Star Africa said it will procure a water treatment plant in order to secure water supply to the plant at GSSH.