The Fiji Sugar Corporation Limited (FSC) has announced notable enhancements in both revenue and profitability despite encountering significant challenges.
Although there has been a 15 percent decrease in cane production largely attributed to unfavorable weather conditions, FSC reported a 12 percent rise in sales revenue and a 10 percent increase in its share of proceeds.
This strong performance, detailed in the financial results for the year ending May 31, 2024, can be attributed to improved operational efficiencies, stringent cost-control strategies, and innovative solutions.
FSC Board Chair Nitya Reddy emphasized the Corporation’s resilience in overcoming substantial challenges, especially considering the chronic neglect and mismanagement that plagued operations for decades.
“It is well-known that the sugar industry, particularly FSC, has faced some of the most severe issues in its 150-year history, primarily due to ineffective management over the past 20 years. This has led to an existential crisis of unprecedented scale,” Reddy stated.
Reddy pointed out that the industry’s performance metrics have suffered greatly due to unsustainably low cane production, falling sugar output and revenues, crippling inefficiencies, and outdated mill infrastructure caused by inadequate maintenance and investment.
“This marks a pivotal period not only in our history but also for our future. We are dedicating all our efforts to rebuild confidence throughout the industry, a task that should not be underestimated,” Reddy added.
He further explained that the current dilapidated state of the mills is the result of years of systemic neglect and poor decisions, cautioning those who expect immediate solutions to consider these realities.
FSC is concentrating on enhancing its manufacturing efficiency while advancing cane production through improvements in transport, harvesting, and farm mechanization. Reddy emphasizes the need to address the rising incidence of burnt cane and eliminate unapproved cane varieties.
“There is also a necessity to transition to a more equitable payment system based on sugar quality rather than just on weight,” he noted.
Reddy recognized that many structural reforms are essential, underscoring the importance of accountability across all industry sectors, and not solely relying on FSC.
Financial highlights for the Corporation include:
– A revenue increase of 12 percent to $235.2 million, reflecting a significant boost in financial performance.
– Share of proceeds rising to $71.15 million from $64.25 million the previous year.
– Trading profit increasing to $13.13 million, compared to $7.45 million from the prior year.
– Profit from operations at $2.51 million, recovering from a loss of $4.98 million last year.
– Positive EBITDA of $24.97 million, up from $17.87 million in the previous year.
– An operating loss decreased to $4.24 million from a previous loss of $23 million.
– Investment in Property, Plant, and Equipment totaled $10.05 million, compared to $6.94 million the year before.
Reddy expressed confidence that, with ongoing stakeholder support, a more robust and sustainable future for Fiji’s sugar industry is attainable.
FSC remains committed to its strategic priorities, which include restructuring, revitalizing crop production, enhancing mill performance, and optimizing revenue.
In addition to financial achievements, FSC has prioritized sustainability and community involvement, promoting environmentally friendly practices and supporting local growers to ensure the sugar industry’s long-term viability.
“While challenges remain, we are resolute in overcoming them. By pursuing new market opportunities and strengthening our partnerships, we position FSC for long-term success,” Reddy concluded.