HARARE – Ariston Holdings has released its trading update for the first quarter ending December 31, 2024, revealing a mixed performance as the company navigates significant challenges in the agricultural sector. The update highlights both declines in sales volume of critical products and a cautious optimism for the future.
Ariston announced that tea sales volume plummeted by 27%, falling to 388 tonnes compared to the prior year’s 530 tonnes. Similarly, macadamia nut sales were severely impacted, with volume decreasing by 52% from 132 tonnes to just 63 tonnes. These declines were attributed mainly to the adverse effects of delayed rainfall and extreme weather conditions during the critical growing period.
Despite these setbacks, the average selling prices for both tea and macadamia remained stable, providing a silver lining amidst declining volumes. However, overall revenue was reported to be 16% lower than the previous year, attributing the shortfall primarily to reduced production capabilities.
The trading conditions continue to be challenging for Ariston, exacerbated by a tight liquidity environment and rising operational costs driven by inflation. In a bid to stabilize the business, the company has introduced several cost-cutting measures, including staff reductions and increased automation to enhance production efficiency.
In a sign of potential recovery, management expressed optimism over the macadamia nut market, citing firm demand and indications of better price stabilization following a global oversupply situation that arose during the COVID-19 pandemic. Early indicators show an improved nut set in macadamia orchards, raising hopes for a better yield.
The company has also begun strategic planting, with 660 hectares of row crops planted this year, which are expected to yield good returns. Alongside these efforts, investments into renewable energy through the commissioning of a solar energy plant at Southdown Estate are anticipated to yield significant savings and guard against ongoing power outages.
Looking ahead, Ariston expects a challenging operating environment but remains focused on maximizing shareholder value through quality production and cost-effectiveness. The outlook suggests that with the right strategic measures, the company could navigate the current adversities and position itself for recovery in revenues moving forward.
The report concluded with a commitment to ongoing improvement and resilience as the company heads into the next quarters, aiming to turn challenges into opportunities for growth.
