South Africa's Illovo Sugar reported a 10 percent decline in first-half earnings on Monday due to lower sugar production and depressed global prices. Headline earnings per share fell to 171.1 cents in the six months to September from 190.1 cents a year earlier, Africa's largest sugar producer said in a statement. Sugar production was hit by bad weather conditions and a strike resulting in total sugar production falling by 9 percent to 1.3 million tons.
Illovo said the decline in earnings was partially offset by higher demand in its domestic market, a weaker rand and cost-cuts. South Africa's revenues service raised sugar import tariffs after months of lobbying by producers who argued that the international price of the commodity was lower than production costs and that cheap imports were strangling business.
Illovo said earnings in South Africa were eroded by prior season sugar imports which were not subject to the tariff increase but that full-year revenue will benefit from the protection. "Since the increase in the government-instituted import tariff earlier this year, imports have declined and their impact on Illovo for the full year is anticipated to be less than in 2013," the company said.
Comments
Comments are closed.