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Published On: Tue, Dec 30th, 2014

Ariston Revenue Up 7 Percent

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ARISTON Holdings Limited, the listed agro-based company said revenue for the full year to September 30 this year increased 7 percent, largely driven by growth in tea sales. Turnover grew to $18,3 million from $17,1 million in the same period last year, the company said in a statement. Bulk tea sales increased by 117 percent to 2 588 tonnes.

While growth in revenue was largely underpinned by tea sales, the financial contribution was below expectations. “Export prices were very weak throughout the year across all grades and the expected increase in blended tea sales did not materialise,” said Ariston.

The group reported an operating loss of $4 million which included $400 000 retrenchment costs and $800 000 incurred in potato planting.

Finance costs were down to $1,2 million from $1,6 million during the same period last year.

Total comprehensive income declined to $615 000 from 2,37 million realised a year earlier.

Ariston said the group had invested in estates rehabilitation and was beginning to realise the benefits.

“The group saw increased contributions from those areas that have benefited from investments made in earlier rehabilitation,” said the company.

“Tea yields rose significantly and newly planted fruit orchards showed encouraging growth. The foundation for increased productivity has now been laid — and full benefits — are beginning to be realised.”

Stone fruit production is on target and the newly planted orchards will produce first crop this season.

This season’s output is expected to double production of fruit in 2014. The uplift will be maintained in the seasons ahead and the company expect to, again, double output in the next two seasons. The apple crop on the established fields is “encouraging”.

The company is expecting modest harvests from apples planted in 2012 and 2013. 0Claremont was entering a phase of rapid and sustained growth in orchard output.

Potato production was more than double the previous year and modest increments in potato plantings are anticipated across all estates. The poultry division is now operating at full capacity with 1,32 million birds being placed during the year.

At FAVCO, the company’s trading division, operations have had a very difficult year with performance below expectations due to depressed economic activity, lower margins and lower than anticipated sales volumes for key products. Sales to the mass market increased to 29 percent of revenue compared to 7 percent a year earlier, but with lower margins.

International tea prices are not expected to recover in the next season while demand for blended teas locally is expected to remain weak, export initiatives will offer “limited and much needed growth”.

The group said working capital for during the first half will be in “short supply” and capital projects will be kept at minimum.

“As resources allow there remains considerable opportunity to expand productive capacity on all farms,” said Ariston.

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