TSL Limited

TSL Limited FY 2023 Analyst Briefing Presentation

By Published On: January 31st, 2024Categories: Corporate announcement, Earnings

Operating Environment

Economic Environment

  • Marked by inflationary pressures, persistent power outages and liquidity challenges in both local and foreign currency, elevated interest rates.
  • Growing trend in dollarisation in the economy – higher proportion of transactions in US$.
  • Change in consumer spending patterns – more informal.

Agricultural Sector

  • 2022/23 summer cropping season was reasonable across most of the country, with adequate rains.
  • National tobacco volumes (new record) – 296 million kgs, 43% ahead of prior year.
  • National average tobacco price – US$3.03/kg, 1% below prior year price of US$3.06/kg.
  • Independently grown tobacco crop closed at 7% of the national crop.


  • Enhancement of shareholder value through sustainable growth
  • Maintaining a low gearing
  • Positive cash generation
  • Reinvestment in expansion of operations
  • Dividend payments to shareholders

Financial Performance


  • Revenue growth underpinned by strong volume performance across most business – particularly tobacco related businesses.
  • Foreign currency revenues recorded at official exchange rate.

Operating Profit

  • ZWL$ cost structure inflated due to exchange rate volatility.

Finance Cost

  • Local currency borrowings which had unsustainably high interest rates were paid off early in the year.
  • Current loan book is in US$

Business Overview


Agricultural Packaging

  • Propak hessian volumes up 32% – stock availability and larger tobacco national crop size.
  • Tobacco paper volumes up 27% – positive market response to locally coated paper.
  • Strategic move to increase paper production in line with the Group’s sustainability drive.

Agricultural Trading

  • Mixed volume performance for Agricura.
  • Better performance from Animal health remedies and new grain protectants – product availability.
  • Margin pressure negatively impacted performance of the Unit.
  • Acquired shareholding of minority shareholder in Agricor (Private) Limited.
  • Acquisition expected to increase flexibility for business to expand and deepen product offering to market.

Farming Operations

  • Produced a superior quality of tobacco – achieved improved yields and price per kg.
  • Favourable yields achieved on soya beans and commercial maize.
  • Reduced wheat hectarage – electricity availability challenges.
  • New banana plantation came into production – increased volumes.


  • Tobacco Sales Floor cumulatively handled 51.9 million kgs of tobacco –125% increase on prior year’s 23.1 million kgs.
  • Strategy to serve the much larger contracted tobacco market yielding fruit – 75% of total volumes handled from this segment.
  • Positive results attributable to a larger national tobacco crop, successful de-centralisation of operations and new customer acquisition.
  • TSF still holds largest market share in independent auction segment.

Commodities Exchange

  • ZMX introduced an orderly, streamlined, digitalized marketplace platform for trading and funding of agricultural commodities.
  • Company is licenced to facilitate trade of 49 commodities (grains, cereals, pulses, horticulture and livestock).
  • Liquid asset status for warehouse receipts successfully obtained during the year – significantly enhances cash flows for farmers.
  • ZMX operations resulted in a number of policy amendments in agricultural marketing – will improve marketing, financing, and trading of agricultural commodities.
  • Business is in its infancy. Trading volumes expected to increase in the near future.

End to End Logistics

  • Increased volumes across most logistics’ divisions – new business model supporting customer throughout the value chain.
  • Tobacco handling volumes up 96% – increased customer base
  • Rail service from both Maputo and Beira continued to operate – satisfactory performance.
  • Strong clearing and forwarding volumes – improved demand.
  • General cargo handling volumes down 19% (reduced fertilisers).
  • FMCG volumes up 32% – new business.
  • Premier Forklift volumes up 16% – growth from new and existing clients. Fleet on hire grown by 32%.
  • Forklift sales volumes at par with prior year.
  • Vehicle rental days down 12% – decline in vehicle fleet.
  • Current fleet replenished towards year-end.
  • More vehicles will be added in FY 2024.


  • Occupancies, returns and level of voids satisfactory – improved demand for warehouse space.
  • Completed construction of 9,000 square meter warehouse in Mvurwi – supported TSF decentralised operations.
  • Construction of new world class 15,000 square meter warehouse in a prime location to be completed in Q2, 2024.

Outlook and Prospects

Key Priorities and Focus

Operating Environment

  • Expected to remain difficult – proactively manage
  • Lower than normal rainfall expected – some negative impact.

Strategy – Continue to pursue key “Moving Agriculture” strategic initiatives.

Investments – Several investments lined up to scale up capacity and improve efficiencies to provide superior offering to the marketplace.

Value Chains – Primarily Agriculture and Mining

Digitalization – Bearing much fruit – more digital investments earmarked for FY 2024.

Value Creation & Preservation – Continue to Enhance earnings, Returns on Invested Capital, Long Term Value Proposition and strengthen Financial Positioning

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TSL Limited FY 2023 analyst briefing presentation

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