27th Feb 2015 10:20
LONDON (Alliance News) - AIM-listed pan-African agricultural company Agriterra Ltd Friday said its pretax loss widened in the first half of the year, hit by a fall in revenue due to sales and volume weakness, but said its beef division has emerged as a solid revenue generator, as it is now working on expanding the division.
The company's aim is to become an integrated pan-African agricultural business with a diversified portfolio of products including beef, cocoa and maize.
Agriterra reported a pretax loss is USD4.5 million for the six months to end-November 2014, compared with a USD1.5 million loss the year before, as revenue fell to USD4.7 million, from USD6.7 million, due to lower sales from its maize division, as well as from its cocoa division, which as hit by the Ebola outbreak last year.
Its net profit however was USD939,000, compared with a USD2.3 million loss the prior year, as it benefited from a settlement claim of USD5.7 million arising from its legacy oil interests in South Sudan.
The company saw a 28% increase in revenue from its beef division to USD2.7 million, up from USD2.1 million last year, boosted by an increase in volumes.
"During the period under review the beef division further distinguished itself as being a primary revenue contributor," the company said, adding "We feel that the beef division has now established a solid and demonstrable base from which to expand significantly both in terms of wholesale and retail sales, as well as by exploring the significant potential in the export market".
Agriterra said that it has identified northern Mozambique as an important area for expansion for its beef division.
"To service this growing market, we are in the process of establishing a butchery and distribution centre in Nampula, Mozambique's third largest city and capital of the northern province of Nampula," the company said.
It said that it has leased a suitable site for this operation, and expects to open the new site in the second quarter of 2015.
"We are also looking at retail possibilities in Nacala and Pemba, both of which are thriving towns in the North, benefitting from significant inward investment into the region," the company added.
Agriterra shares were down 7.6% at 0.610 pence Friday morning.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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