TATEPA Limited has managed to reduce its losses by six times to 0.8bn/- thanks to avocado business which doubled in a single year.
The tea and avocado group posted reduced losses after tax by posting a 0.8bn/- loss in 2016 compared to 4.8bn/- loss of 2015. Tatepa’s Chairman G. C Theobald said in a financial report that the year under review showed significant improvements for the firm, despite continued difficult trading conditions.
“We hope to see a much improved balance sheet by the end of 2016-17. This shall also have a positive impact on the profitability of the Group.
“Mombasa tea prices dropped by 20 per cent from 2015 and a deep drought affected production volumes,” Mr Theobald said. The chairman said, however, improved tea quality and an increase in avocado export volumes of more than twice the previous year saw the Group reduce its net loss after tax.
“Rungwe Avocado Company (RAC) is finally moving into profit,” Mr Theobald said adding “this year it exported over 1,300 tonnes of fruit to Europe, compared to 566 tonnes last year. This led to it making a small profit for the first time since inception.
” On Wakulima Tea Company (WTC), Chairman said, had significantly better prices than the previous year, and this helped to limit the damage done by the much lower volumes arising from a deep drought in the first quarter.
“It is intending to capitalise on the better prices being achieved by securing more long term contracts at fixed prices,” Mr Theobald said.
WTC thus improved its performance considerably and made a trading profit of 500m/- as compared to a loss of 700m/- last year. On financing he said WATCO paid off its CRDB bank term loan completely. It now has no term debt and remains only with an overdraft facility of 2.0 million US dollars and 1.35bn/- from CRDB.
While, RAC currently has unsecured debt of 1.2million US dollars from AECF, 1.1million US dollars from the African Wildlife Foundation (AWF) and 1.4million US dollars secured debt from AgDevCo Ltd. Also Chai Tausi has an overdraft facility of 750m/- from CRDB.
“Each company’s debt is currently secured by its own assets…,” Mr Theobald said.