The Fiji Sugar Corporation Limited (FSC) has announced notable improvements in its revenue and profitability, overcoming various obstacles. Despite a 15 percent drop in cane production primarily due to unfavorable weather conditions, FSC experienced a 12 percent rise in sales revenue and a 10 percent increase in its share of proceeds.
The financial results for the year ending May 31, 2024, reflect this positive trend, driven by enhanced operational efficiencies, stringent cost-control measures, and innovative solutions. Nitya Reddy, chair of the FSC Board, emphasized the corporation’s resilience in tackling significant challenges, particularly against a backdrop of chronic neglect and mismanagement over the past two decades.
Reddy pointed out that the industry, and FSC specifically, has faced severe issues in its 150-year history, aggravated by ineffective management and oversight in recent years. He described the current situation as an existential crisis, with unsustainably low cane production, diminishing sugar output, and substantial inefficiencies contributing to the ongoing difficulties.
“This is a critical moment, not just for our past but also for our future. We are committing all our efforts to rebuild confidence across the industry, which is no small task,” Reddy stated.
He underscored that the deteriorated condition of the company’s mills is not a recent issue but the result of years of systemic neglect, inadequate maintenance, and poor investments. Reddy cautioned those expecting quick solutions to recognize these historical challenges.
FSC is concentrating on restoring manufacturing efficiencies alongside initiatives to enhance cane production and improve logistics in transportation, harvesting, and farm mechanization. Addressing the rise in burnt cane and phasing out unapproved cane varieties are also priorities.
Reddy explained the need to shift to a payment protocol focused on sugar quality rather than weight, underlining the necessity for structural reforms across the industry, with responsibility shared among all stakeholders.
The corporation’s revenue surged by 12 percent to $235.2 million, reflecting notable financial improvement driven by increased sales and better pricing. It marked the highest revenue returns in 18 years, emphasizing the sugar industry’s significance to Fiji’s economy.
Key financial highlights include:
– Share of proceeds increased to $71.15 million from $64.25 million in the previous year.
– Trading profit rose to $13.13 million from $7.45 million.
– Profit from operations shifted to $2.51 million from a loss of $4.98 million.
– EBITDA increased to $24.97 million from $17.87 million.
– Operating loss reduced to $4.24 million from $23 million.
– Investment in Property Plant and Equipment reached $10.05 million, compared to $6.94 million the previous year.
Reddy expressed confidence that, with continued support from stakeholders, FSC can develop a more resilient and sustainable future for Fiji’s sugar sector. He reiterated the corporation’s commitment to restructuring, revitalizing crop production, enhancing mill performance, and optimizing revenue.
FSC has also prioritized sustainability and community engagement, promoting environmentally responsible practices and assisting growers to ensure the sugar industry’s long-term viability. Reddy concluded by acknowledging the ongoing challenges but reaffirming the corporation’s determination to navigate these hurdles and pursue new market opportunities for sustainable growth.