DIVERSIFIED local firm, TSL Limited (TSL) has set the definitive dates for the completion of its acquisition of packaging firm, Nampak Zimbabwe Limited (NZL), to the third quarter of this year.
In 2024, TSL tabled a US$25 million offer to acquire a 51,43% stake in NZL from its South African parent company, Nampak Limited (Nampak), as the latter was moving to divest from Zimbabwe owing to macroeconomic challenges it was facing and rising debt.
In a trading update for its first quarter ended January 31, 2025, TSL said it would continue to pursue key strategic initiatives.
“The group’s acquisition of a 51,43% stake in Nampak Zimbabwe is on track for completion in Q3 2025. The board is currently engaged in obtaining the requisite approvals for the acquisition,” the statement read.
“Notwithstanding the challenging operating environment, the group will continue to pursue key strategic initiatives that are expected to enhance shareholder value.”
TSL said as part of the group’s evaluation of its investments, the board decided to exit two non-core businesses, to create capacity to pursue more strategic operations.
“The farming operations were wound up on October 31, 2024 and the group will be winding down its car rental business on March 31, 2025,” TSL said.
The company reported a difficult operating environment.
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This comes as the current 2024/25 summer cropping season was forecasted to have normal to above normal rainfall, but first started with a dry first half.
Farmers were naturally cautious given last season’s El Niño-induced drought, said to be the worst on record in 42 years.
However, weather conditions have since improved significantly towards the end of the first quarter.
TSL said as of last Friday, 11 million kilogrammes (kgs) had been sold compared to 15 million kgs for the same number of selling days in the 2023/24 season.
“The 2025 tobacco selling season commenced on March 5, compared with March 13 in the previous year. The national tobacco crop is projected to be between 15% and 20% higher than the 231 million kilogrammes achieved in 2024,” TSL said.
“As of March 14, 11 million kgs had been sold compared to 15 million kgs for the same number of selling days in the 2023/24 season.”
Group revenue for the first quarter was 9% below the comparative period in prior year due to delayed rainfall.
“The delayed onset of the summer rains adversely affected the group’s agriculture-based operations,” TSL said.
“Group profit was, however, significantly ahead of the previous year as a result of cost containment measures implemented towards the end of the 2024 financial year.”
TSL subsidiary, Propak, saw its first quarter volumes being in line with the budget and revealed adequate Hessian and paper stocks to meet market requirements for an increased tobacco crop.
At the firm’s Agricura subsidiary, first quarter revenue was 8% below prior year.
Crop chemical volumes were negatively affected by the slow uptake by farmers owing to the delayed start to the 2024/25 rainy season.
“The improved rainfall patterns in January and February 2025 are expected to positively impact Agricura’s Q2 performance,” TSL said.
Under logistics operations, tobacco handling volumes in the first quarter were 34% below the prior period and forklift hire hours were 11% below prior year.
This was owing to most tobacco merchants having closed operations earlier.
General cargo storage volumes were 66% ahead of prior year as a result of the delay in the onset of the summer rains, resulting in agricultural inputs being kept for longer than anticipated.
The handling volumes were resultantly depressed as most of the fertiliser received will be distributed to customers in Q2.
