Tongaat Hulett, SA’s largest sugar producer, is starting to see the positive effects of the end of a devastating drought that hit its operations in KwaZulu-Natal, Zimbabwe and Mozambique. The company, which posted a 9% increase in operating profit in the first half to end-September, forecast strong increases in sugar production in the medium term. Despite the improvement in its sugar operations, the contribution of land sales to Tongaat’s operating profit grew significantly. Group operating profit of R1.471bn was up 9% from R1.35bn a year earlier, despite revenue falling 4.5% to R8.2bn. Sugar contributed R835m to operating profit, little changed from R825m a year earlier. Land sales, on the other hand, realised an operating profit of R441m — up significantly from R269m a year earlier. After-tax profit was R791m, up 15% from R687m a year ago. Weak spots were the South African sugar operation — hit by erratic prices as well as rising imports as a result of a gap in duties that the com...

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