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Senior Business Reporter

AMALGAMATED agriculture listed company TSL Limited profited from increased uptake of tobacco packaging materials by farmers in anticipation of the earlier start to the tobacco marketing season as revenue grew by 106 percent and 606 percent in inflation-adjusted and historical terms respectively.

In a trading update for the first quarter ended  January 31, group secretary, Ms Fadzayi Pedzisayi said the agribusinesses are expected to benefit from a larger tobacco crop and what is anticipated to be a good marketing season.

The 2023 tobacco marketing season started on  March 8, three weeks earlier than in the previous year.

Pedzisayi observed that indications are that national tobacco volumes are expected to range between five percent and 10 percent above prior year.

Group revenues in the first quarter are mainly from the supply of agricultural inputs, provision of logistics services, and real estate services primarily to the agriculture industry, she said.

“Revenue grew by 106 percent and 606 percent in inflation-adjusted and historical terms respectively for the quarter.

“This growth was mainly driven by firmer volumes in the agri-inputs business, a stronger performance in the logistics business, and increased uptake of tobacco packaging materials by customers in anticipation of the earlier start to the tobacco marketing season.”

TSL is an integrated and intelligent handler of all movements in the agriculture value chain. The group provides comprehensive solutions in the agriculture industry from seed to shelf with inputs and packaging.

During the quarter under view, the group’s tobacco auctioneering subsidiary Tobacco Sales Floors (TSF) undertook extensive preparations for the tobacco marketing season.

The business doubled the capacity of its decentralised floor in Mvurwi to cater for increased contracted volumes, and augments the Harare, Karoi and Marondera floors.

“Due to the earlier start of the tobacco marketing season, Propak Hessian ramped up the supply and distribution of tobacco packaging materials resulting in volumes of both hessian wraps and tobacco paper being significantly ahead of prior year.

The market has welcomed the locally produced tobacco paper and there has been a marked increase in volumes,” noted Pedzisayi.

She said the business is adequately stocked for the season on all packaging materials.
On Agricura business unit, major product lines recorded good volume growth on last year, with improved product availability and market reach.

Performance in the real estate operation remains satisfactory with the business unit completing the expansion of the Mvurwi sales floor, bringing the new warehouse space to 9 000 square metres.

“This development has supported TSF’s decentralisation drive. The business is also creating additional world-class warehousing capacity of 23 000 square metres on two of the Group’s properties.

“This move is intended to support the growth of both the agriculture and logistics operations over the next 12 to 18 months.

Demolition works are at an advanced stage on the one site, while ground works have commenced at the second site. The redevelopment of both sites is expected to start in the second quarter,” said Pedzisayi.