Ariston expects tea sales to rise 6%
HARARE – Agro-concern, Ariston Holdings expects tea sales to rise 6% to 2700 tonnes in FY17 up from 2048 tonnes the previous year boosted by good rains and a lower than expected production in Kenya.
Ariston chief executive Paul Spear in a trading update at the company’s annual general meeting said in terms of production, FY17 is expected to reflect an improvement in tonnages across all product ranges.
“FY17 tea harvest is expected to comfortably exceed tonnages achieved in prior year. Overall tea quality is good. Export prices for tea improved marginally on FY16 due to the lower than expected production in Kenya. We project a 6% growth in local tea sales,” said Spear.
Zimbabwe’s tea production, which peaked at 22,4 million kgs in 2001, is slowly approaching those levels, with 2012 output reported at 19 million kgs. The country currently accounts for less than 1% of global output, although its high quality tea is used for blending all over the world.
Ariston exports 70 to 80 % of its tea and the decline in global prices would hit its revenue hard.
He added that production tonnages of stone fruit were ahead of prior period but prices are flat and Pome fruit had a promising start to the FY17 season.
Improved marketing of both pome and stone fruit has enhanced performance at Claremont as all dams are full thus irrigation will not be constrained by water supplies this season. Spear said that the Rehabilitation of the Claremont micro-hydro power plant had been completed and awaiting ZESA power purchase agreement
On Macedonia pricing he said the prices are firmer than FY16 and the crop is forecast to be the highest to date at 1500 tonnes up from 1250 tonnes prior year.
He said quality was greatly compromised in FY16 but have since rectified the problem with quality of macadamia having greatly improved in FY17.
Apples sale volumes are forecast at 1280 tonnes up from 779 tonnes on the back of a firmer Rand. The fall of the South African Rand had been putting pressure on the group’s operations as it become cheaper to import south African produce.
“We are confident that with the firming Rand we are likely to go back on track in terms of sales” he said.
Potatoes sales are projected at 1500 tonnes up from 850 tonnes prior year. Spear said although there has been heavy rains there was still very conservative targets and was confident they could be achieved.
At the AGM, directors fees were approved at $54 700 while audit fees at $100 000.