TSL Limited

TSL Limited | Group Abridged Reviewed Results For The Six Months Ended 30 April 2023

By Published On: July 1st, 2023Categories: Corporate announcement, Earnings



The operating environment remained difficult. The effects of both global and local inflation have been witnessed across the board and agricultural inputs have not been spared. The local currency continued to depreciate against the USD with a widening gap between the official exchange rate and rates obtaining on the alternative market. This has brought with it attendant challenges in pricing of goods and services. The economy has increasingly dollarized. Power supply has been erratic and has consequently increased the cost of doing business.

The summer cropping season was reasonable across most of the country, with adequate rains. The tobacco marketing season commenced on 8 March 2023, 6 weeks earlier than in the previous year. National tobacco crop sold by end of April 2023 was 35% ahead of prior year at 134 million kgs. The average tobacco price remained firm at US$3 per kg, marginally ahead of last year. Indications are that national tobacco crop volumes will set a record high.


The Directors advise users to exercise caution in the interpretation of the Group’s abridged financial statements. There are numerous exchange rates prevalent in the marketplace which inflate the ZWL cost structure of the business whilst foreign currency revenues are recorded at the official exchange rate.

In inflation adjusted terms, revenue and profit from operations are 140% and 257% above the comparative period respectively. There has been strong volume growth across all businesses and in particular the tobacco-related businesses. A focus on executing the Group’s strategy which has incorporated investment in expanding capacity, utilizing technology, improving operating efficiencies, securing new business and deployment of capital for value has enhanced profitability given the dynamics in the operating environment.

The Group’s financial position remains solid. Local currency borrowings were paid off early in the financial year due to unsustainably high interest rates. The Group has utilized local USD borrowings to fund key strategic initiatives in the period. Gearing levels remain acceptable. The business has continued to generate positive operating cash flows and reinvested in the expansion of the operations and in payment of dividends to shareholders.

In line with the strategy, the Group successfully bought out a foreign minority shareholder in Agricura giving it a 100% shareholding in this key strategic business unit.



Tobacco related services
The strategic initiative to focus on serving tobacco contractors coupled with successful decentralisation of operations resulted in a significant increase in tobacco volumes handled in the period. Furthermore, the tobacco season had an early start by 6 weeks. The recently completed Mvurwi floor performed reasonably well in the period. Resultantly, volumes from tobacco contractors grew by 44% whilst independent auction volumes went up by 63%.

Propak’s hessian volumes were 71% ahead of prior year as the business was adequately stocked to meet the increased demand on account of the larger tobacco crop. Market share continues to increase. Some hessian was exported into the region for the first time in many years. Tobacco paper volumes were 59% ahead of prior year as the market positively responded to the locally coated paper from the business’ recently installed paper coating line.

Agricultural trading
Strong volume growth was recorded in most of the unit’s product lines in the period. The business was sufficiently stocked for the summer season. The introduction of new product lines resulted in improved volume performance.

Farming operations
The new banana plantation went into production in the period resulting in volume growth of 87% ahead of prior year. An additional 25 Ha of new bananas have been planted. Most of the bananas are for the export market. Maize and soya bean yields have been satisfactory. The tobacco crop achieved satisfactory yields and prices achieved to date have been acceptable.


End to end logistics services
Distribution volumes were 51% ahead of prior year due to increased volumes from the business’ existing customer base. The International Services division recorded 40% growth in volumes aided by increased use of rail from Maputo. The business also handled some lithium and sulphur on behalf of its customers on rail prior to the introduction of Statutory Instrument 213/2022 which banned exporting of unprocessed lithium. Sulphur volumes resulted in significant volume growth in the customs clearing, forwarding and bond store business. Forklift hire hours were 19% ahead of prior year as some key customers increased their business with Premier Forklifts. Tobacco handling volumes were significantly up on prior year and transport volumes were up 39%. This is largely attributable to the business model which supports the customer throughout the value chain.

Vehicle rental services
Rental days were 13% ahead of prior year attributable to an increase in international travelers.

Real Estate Operations
Voids improved to 12% from 37% in prior year as demand for warehousing space increased in the period. The business, in support of the TSF decentralization thrust, completed the 9,000 square meter Mvurwi warehouse before the commencement of the tobacco marketing season. Demolition of a dated warehouse in a prime location in Harare was completed in preparation for construction of a new world class 15,000 square meter warehouse in the second half of the financial year.


The Group continues to pursue several strategic initiatives aligned to the “moving agriculture” strategy that are expected to have far-reaching benefits for the marketplace as a whole.

The aforementioned difficulties in the operating environment are expected to persist and the business will focus on continued sustainable value creation and preservation.


At their meeting held on 28 June 2023, the Directors declared an interim dividend of US$0.0027 per share payable in respect of all ordinary shares of the Company. This dividend is in respect of the financial year ending 31 October 2023 and will be payable in full to all shareholders of the Company registered at close of business on 14 July 2023.

The payment of this dividend will take place on or about 24 July 2023. The shares of the Company will be traded cum-dividend on the stock exchange up to the market day of 11 July 2023 and ex dividend as from 12 July 2023.

For and on behalf of the Board

A.S. Mandiwanza
28 June 2023

TSL Limited Group Abridged Reviewed Results For The Six Months Ended 30 April 2023.pdf

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