Agriculture company Tanganda experienced a decline in export volumes during the third quarter ending June 30, 2024, primarily due to issues with production timing and packaging material shortages.
Bulk tea exports fell by 9% to 4,504 tonnes compared to the previous year, a drop attributed to the concentration of production in the third quarter and the timing of sales. The company also faced challenges with packaging supply and managing working capital, which added pressure to its export numbers.
Group company secretary, Ms. Sharon Kodzanai, explained, “The 9% decline in bulk tea exports reflects the timing of sales and production concentration. Despite this, we remain confident in our strategy to diversify and grow in regional markets.”
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Tanganda’s diversification strategy paid off with a 50% increase in packed tea exports to the regional market. This market diversification is a key part of the company’s efforts to reduce dependence on traditional markets.
“Our diversification efforts have led to a 50% growth in packed tea exports to the region, demonstrating that our strategy is working, despite other challenges,” Ms. Kodzanai noted.
In contrast, macadamia exports declined by 33%, from 735 tonnes to 494 tonnes, despite a 61% production increase due to better yields from maturing plantations. This drop was linked to delays in the marketing season, which disrupted the sales schedule.
On the financial side, Tanganda reported stable revenue of US$3.4 million for the quarter, consistent with the prior year. However, revenue for the nine months ending June 30, 2024, dropped by 5% to US$14.5 million, and profit after tax decreased by 8% to US$1.2 million.
“Our financial results reflect the complex operating environment, marked by policy changes and drought conditions caused by El Niño. However, we have implemented strategies to enhance efficiency and control costs, which we expect to improve our performance in the coming months,” Ms. Kodzanai said.
Looking ahead, Tanganda remains cautiously optimistic despite the challenges posed by the introduction of the ZiG currency and other fiscal and monetary measures. The company believes that refining its strategy and focusing on improving yields and market diversification will help navigate these difficulties.
Ms. Kodzanai added, “The demand for our packed tea products remains strong locally and regionally, and we are committed to sustaining our market diversification efforts. We are confident that our mitigation strategies will help us overcome current challenges and improve our future performance.”
Although the company’s export volumes have been impacted, Tanganda’s focus on diversification and strategic adjustments indicates resilience and a long-term approach to growth.
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