Tongaat Hulett, which owns Triangle Sugar Limited and half the stake in Hippo Valley, says in plans to stay put in Zimbabwe despite the noise about Zimbabwe’s indigenisation programme.
And it has every reason to. The Zimbabwe sugar operations generated more profit than any of its other operations, including those in South Africa where the company has its headquarters.
According to the company’s annual results for the year ending March, which were released last Thursday, the Zimbabwe operations recorded an operating profit of R630 million, a slight improvement from R621 million the previous year.
But the profit was slightly down in United States dollar from US$84 million to US$74 million.
In South Africa, sugar operations alone generated R52 million while downstream value added activities contributed a further R256 million.
Mozambique operations were the second largest contributor to operating profit with R421 million, followed by Swaziland with R76 million.
Tongaat Hulett chief executive Peter Staude said the company was in Zimbabwe to stay for a very long time and would work closely with the people there.
The company’s two operations in Zimbabwe employ 18 000 people and were in an important recovery, growth and expansion phase, which should create sustainable value for all stakeholders.
“A central part of this recovery is the substantial development of indigenous private cane farmers,” the company says in its annual report.
“At the end of 2012-13 season, at least 670 active indigenous farmers, farming some 11 200 hectares and employing more than 5 600 people, supply 850 000 tonnes of cane which generates US$56 million in annual revenue for them.
“Zimbabwe, with Tongaat Hulett as a partner, has the potential to further develop indigenous private cane farmers substantially…. Based on Tongaat Hulett’s view of its existing mills, a further 600 farmers on 12 700 hectares could supply an additional 1.4 million tonnes of cane per annum.
“In total, all these indigenous private cane farmer developments could earn more than US$140 million gross revenue per annum and employ more than 12 000 people,” the company says.