TSL Limited says plans to expand and improve the group’s storage infrastructure are underway with the construction of 9 000 square meters of additional warehousing space having commenced.
The group, in its annual report for 2021, said this comes after it completed a 10 000 square meter warehouse in Harare, which was occupied in May 2021.
“Ongoing plans to expand and improve the group’s infrastructure are underway with construction anticipated to commence at one of the group’s strategically located warehouses.
“This construction of an additional 9 000 square meters of warehousing is anticipated to kickstart in the 20a22 financial year,” Mr Anthony Mandiwanza, the group’s chairman said.
He said occupancies remained satisfactory in 2021 and void levels decreased compared to prior year.
“This is part of the group’s strategic initiatives to create fit-for-purpose, modern infrastructure that facilitates the movement of agriculture,” said Mr Mandiwanza.
TSL through its wholly owned subsidiary Bak Logistics, has over 100 000 square meters of industrial warehousing and storage space.
According to the annual report, Bak Logistics recorded volume growth in distribution of 48 percent, ports 51 percent, transport 20 percent and tobacco handling 2 percent.
“This growth was attributable to new clients being signed up and the commencement of transport services from decentralised tobacco floors. Storage and handling volumes in FMCG and general cargo were 75 percent and 24 percent below comparative period respectively, due to global supply chain disruptions which resulted in product being moved directly to consumers,” Mr Mandiwanza said.
He noted that margins came under pressure as global supply chain challenges resulted in higher costs, but new business lines were recorded in the freight forwarding division, which recorded satisfactory volumes.
“The logistics business responded positively to the ongoing initiatives to recover market share through competitive pricing and optimisation of capacity,” Mr Mandiwanza said.
He highlighted that in partnership with international logistics players, Unitrans and DP World, and working with the NRZ, a rail service was commenced from Maputo to Harare.
“Eight trains had been moved in the period to year-end and this is expected to increase and improve consistency into the future.”
Overall, the group achieved good volume growth across most business units with inflation adjusted revenue for the year up 13 percent on prior year attributable to improved performance by the agriculture-based business units.
Mr Mandiwanza said a significant portion of group revenue was generated in foreign currency which is converted and reported in ZWL using the official exchange rate. He said TSL’s financial position remained firm with the focus on shareholder value creation and preservation.
He added that most working capital requirements were funded from internally generated cash resources and the positive cash flows generated were applied towards funding the operations, paying dividends to shareholders and acquisition of productive assets in the year.