TSL seeks forex to stay afloat

Published: 03 February 2019
Industrial holdings group Tobacco Sales Limited (TSL) says it will this year focus on partnerships with international firms to generate foreign currency to cushion its operations.

TSL's plan comes at a time when local companies are failing to import critical raw materials for their operations as foreign currency shortages in the country intensify.

TSL chief executive Patrick Devenish told Standardbusiness that the company would bolster forex generation across its logistics, agriculture, packaging and real estate division to enhance self-sufficiency.

Devenish said TSL would deepen its partnership with German giant DB Schenker to earn the company the required foreign currency.

"Our forex generation is dependent on the services we provide to DB Schenker through our logistics division. We want to deepen this relationship with them to generate more foreign currency. DB Schenker is one of the world's largest logistics companies and we have a very strong relationship with them," Devenish said.

"We work together. They value our presence in Zimbabwe and we value their global reach. We do stuff for them. We lift containers, empty containers, clearing and forwarding and offer transport to them."

DB Schenker is a logistics and supply chain management entity valued at €10 billion. It is a division of the German rail operator Deutsche Bahn AG owned by the Germany government.

As part of the forex-generating drive, Devenish said TSL's Agricura, which provides crop chemicals and veterinary products, would also begin to export its products to neighbouring countries soon.

He said export expansion would also be driven through Corteva an American company (formerly Dow Du Point) which is a shareholder in Agricura.

The TSL boss said his company would inject $10 million to enhance its warehouse facilities.

"Our warehouse TS timbers situated close to Tobacco Processors Zimbabwe will be demolished and rebuilt. Then we have the Hubbert Fox complex which we also aim at repairing. We need about $10 million altogether. We have already started demolishing TS timber with a view of finishing refurbishing in six months' time," he said.

The company recorded a 19% jump in revenue to $52,1 million in the full year to October driven by a strong performance of its agriculture-related business.  

The company's profit-after-tax more than doubled to $12,9 million compared to the $4,8 million recorded in the previous year.

This season TSL anticipates at least a 2% growth in tobacco output from 500 000 kilogrammes depending on weather outlook.

"The quality is good these days. You know 80% of tobacco is now grown by smallholder farmers and they grow a very nice crop," he said.
- the standard
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