TANGANDA Tea Company (Tanganda) is focusing on extending regional and international market reach for its packed tea products to spread risks amid volatility in the domestic market.
The group endured a difficult third quarter ended June 30 that was characterized by weaker consumer spending due to tightened liquidity of the local currency as authorities sought to manage inflation This is premium content. Subscribe to read article.
The packed tea segment which contributes 54 percent of group revenue (HY24) reported improved exports despite a subdued overall volume performance.
Packed tea volumes of 1 303 tonnes were 11 percent below 1 459 tonnes achieved in the previous year due to a combination of packaging supply constraints and working capital management.
“Sustained market diversification to increase exports registered 50 percent growth on packed tea export volumes into the region,” company secretary Sharon Kodzanai said in the latest trading update.
“The demand for our packed tea products remains firm both on the local and regional markets and focus is on sustained diversification of the market,” added Kodzanai.
Tanganda has business interests in agriculture where it operates five estates with tea, coffee, avocados and macadamia nuts and a beverage segment which consists of a tea blending and packaging plant and distribution depots dotted across the country’s major cities.
During the period under review, bulk tea production yield of 7 293 tonnes, affected by the late onset of the rains in the first quarter of the year, recovered and was in line with prior year production.
Export volumes declined by nine percent to 4 504 tonnes from 4 959 tonnes achieved prior year due to timing of sales as production was more concentrated in the third quarter.
Macadamia production volumes grew by 61 percent to 1 487 tonnes from prior year volume of 921 tonnes as yield per hectare improves with plantations maturity profile.
The 33 percent decline in nut in shell exports from 735 tonnes achieved prior year to 494 tonnes is due to delayed start of the marketing season.
Meanwhile, company revenue for the quarter under review of US$3,4 million was in line with the prior year while revenue for the nine months of US$14,5 million registered a five percent decline against US$15,3 million achieved in the prior year.
Tanganda’s profit after tax declined by eight percent to US$1,2 million from US$1,3 million achieved in the previous year.
The company said it is optimistic that it has put in place mitigatory strategies to enhance process efficiencies and manage costs to improve performance.
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