Listed sugar manufacturer Illovo Sugar (Malawi) plc has posted a K6.1 billion profit in the half-year ended February 28 2021 and has resolved to pay an interim dividend of K2.9 billion or K4 per share.
Minority shareholders of the company have for the past four years voiced out concerns over the dividend drought, accusing the company of being inconsiderate to their investors.
Last year, shareholders expressed dissatisfaction with the issuance of a dividend of 50 tambala per share, a situation which Minority Shareholders Association of Malawi general secretary Frank Harawa said will fail to push up share price on the local bourse.
But the company said in the half-year financial statement published on Monday co-signed by chairperson Gavin Dalgleish and managing director Lekani Katandula declared the interim dividend of K4 per share in respect of the ordinary shares of the company for the six-month period.
During the review under period, the Malawi Stock Exchange-listed sugar manufacturer’s sales revenue remained flat with six-month sugar molasses sales totalling K74.5 billion slightly up from K73 5 billion in 2020.
The operating profit rose to K10.6 billion against K5 billion for the six-month to February 2020 largely on the back of improved domestic market sales volumes.
This was despite the domestic market being under pressure through a combination of general instability, slowing economy due to the Covid-19 pandemic, currency depreciation and the influx of smuggled sugar.
Reads the statement in part: “Domestic sugar sales reflected a welcome return to more normal levels supported by active marketing and logistics improvement initiatives and sustenance of our reduced domestic pricing since mid-December 2019.”
The company is upbeat that the stable domestic inflation and interest rates, moderate exchange rate depreciation and improved national food supplies would provide a platform for a better second half.