25% increase in grain sales volume in FY2020

Grain division

The Company’s Grain division has performed better than the previous financial year, with meal sales exceeding FY2020 volumes by more than 5,000 tons (25,389 tons in FY2021 vs. 20,240 tons in FY2020). This has been driven by the ability to maintain our stronghold in the central region of Mozambique and the continued commitment to cater to our clients’ needs. The recommissioned 1kg bag packaging line and shift to delivery directly to retailers has begun paying off, as monthly sales increased from a mere 1 ton per month in FY2020 to a high of 20 tons in February 2021. We will continue to develop this offering and expect to realise higher margins during FY2022.

In early 2020 the Company entered into “pre-paid” contracts which were necessary to resolve our short-term cash flow challenges; we completed these as required, but at a lower price than we would have ordinarily achieved on the open market, which resulted in a lower sales margin. Delays in receiving funds in August 2020, forced us to continue buying maize late into 2020, when prices were as much as 30% higher than budgeted, thus negatively impacted sales margins.

DecaSnax

The DecaSnax initiative (production and manufacture of puffed corn snacks for sale into the Mozambican market) began in December 2020, being a joint venture with a Zimbabwean snacks producer. Sales and demand have been increasing steadily to date and the production team is looking to double production, by introducing a second shift, to meet demand.