Illovo Sugar (Malawi) plc reported a 75 percent decline in its earnings to K2 billion in the six months ended February 28 2020, from K8.1 billion recorded in the previous period.
The Malawi Stock Exchange (MSE)-listed sugar manufacturer’s published financial statements jointly signed by Illovo Sugar (Malawi) plc managing director Lekani Katandula and board chairperson Gavin Dalgleish last week showed that the firm’s revenue, however, increased from K62.4 billion to K73.5 billion during the same period last year.
The firm attributed this to challenging operating and market conditions, including informal sugar imports and logistical challenges due to the rehabilitation works at Nacala Port in Mozambique.
Reads the statement: “Domestic sugar sales have been on a downward trend against a background of the ongoing influx of both formal and informal sugar imports’ from neighbouring countries, a development which is having a severe impact on the profitability of the company and revenue generated by growers.
“Export sugar revenues are also below expectation mainly as a result of logistical challenges arising from rehabilitation works currently taking place at the port of Nacala.”
In the medium to long-term, with regard to the prevailing commercial environment, it will endeavour to retain and build a direct local consumption market subject to the impact of the novel coronavirus (Covid-19) on domestic sugar sales.