The Fiji Sugar Corporation Limited (FSC) has released its financial results for the year ending 31 May 2024, showing significant improvements in both revenue and profitability despite various challenges.
Although cane production decreased by 15% primarily due to adverse weather, FSC reported a 12% increase in sales revenue and a 10% rise in its share of proceeds. This encouraging performance was attributed to improved operational efficiencies, strict cost-control measures, and innovative solutions.
Nitya Reddy, Chairman of FSC, stated that the Corporation demonstrated resilience in overcoming considerable challenges, particularly the chronic mismanagement and neglect that had affected operations for decades. He emphasized that the sugar industry has faced some of its most serious issues in its 150-year history, stemming from a lack of vision in management and oversight over the past 20 years, leading to an unprecedented existential crisis.
Reddy noted that the current crisis resulted from low cane production, declining sugar output, significant inefficiencies, and a lack of proper maintenance and investments in mill infrastructure. He described this as a pivotal moment for the industry, expressing the need to rebuild confidence across all levels.
He mentioned the deteriorated state of the mills as a product of systemic neglect and poor management practices over the years. Reddy cautioned against expecting immediate changes, stating that addressing the industry’s challenges requires time and concerted effort.
FSC is prioritizing the restoration of manufacturing efficiency while promoting improved cane production, transport, harvesting, and farm mechanization. Addressing issues such as burnt cane and unapproved cane varieties is also crucial. Furthermore, Reddy advocated for a shift towards a payment structure that rewards sugar quality rather than just weight.
The Corporation’s revenue rose by 12% to $235.2 million, driven by higher sales and prices, marking the highest revenue return in the past 18 years. Key financial highlights include:
– The Corporation’s 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 in the previous year.
– Profit from operations improved to $2.51 million compared to a loss of $4.98 million in the previous year.
– EBITDA reached positive $24.97 million, up from $17.87 million in the previous year.
– The operating loss narrowed to $4.24 million from $23 million in the previous year.
– Investments in Property Plant and Equipment totaled $10.05 million, an increase from $6.94 million.
Reddy expressed confidence that with the support of stakeholders, FSC can create a more sustainable future for Fiji’s sugar industry. The Corporation remains committed to its strategic goals of restructuring, revitalizing crop production, enhancing mill performance, and optimizing revenue.
In addition to financial improvements, FSC is placing emphasis on sustainability and community engagement, promoting environmentally responsible practices and supporting growers to ensure the sugar industry’s long-term viability. Reddy acknowledged ongoing challenges but reaffirmed the Corporation’s determination to explore new market opportunities and strengthen partnerships for continued success.