africa Agriculture commodities Economy export Farming Mozambique South Africa Swaziland Zimbabwe

Tongaat Hulett full-year HEPS to drop by about a third

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The sugar producer says operating profit is expected to be at least 15% less than that reported in the year before

Tongaat Hulett said on Thursday that lower sugar prices, a stronger rand and higher imports took the wind out of its sails in the year to March.

Headline earnings per share will drop by at least 30% in the review period, from the year-before period, the company said in a trading update.

Markets reacted negatively to the news, sending the share price down nearly 8% to R85.70, its lowest point since early 2016.

The sugar producer, which has operations in neighbouring countries, including Zimbabwe, Mozambique and Swaziland, said operating profit was expected to be at least 15% less than the R2.33bn reported a year ago.

“The South African sugar operations experienced higher than anticipated import volumes into the local market as a result of inadequate duty protection that prevailed for a period,” according to the trading statement.

“The displaced locally produced sugar was exported in the latter part of the year and was impacted by lower world prices and a stronger currency.”

The KwaZulu-Natal-based company also generates income from land conversion and development activities.

Source: BusinessDay

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