RES PROFIT SHOOTS UP TO E508M AFTER TAX

MBABANE – Talk about a stellar performance by Royal Eswatini Sugar (RES) Corporation, whose profit after tax grew from E298.1 million to a whopping E508 million.

The company reached such a milestone in history despite the outbreak of COVID-19 in March 2020. Even though this year the company’s crop yields were lower than last year, it achieved good performance because of excellence in their factories and an increase in the sugar price, good rains and effective cost control. “The final result is a record profit after tax,” reads RES Corporation’s 2021 integrated annual report.

Resilience

RES Corporation Board of Directors Chairman Absalom Themba Dlamini said the company displayed its resilience during a year which had been extremely challenging on a number of strategic fronts. The chairman described such an achievement as the highest profit in the company’s history, despite a low crop due to a long dry season and the outbreak of COVID-19, negatively affecting the yields. The company also had a revenue of E3.78 billion, which indicated an increase compared to the previous year’s E3.37 billion. Dlamini said they achieved a 12 per cent higher sugar price and a 32 per cent higher ethanol price compared to the previous year. Cash generation was strong and they were able to pay a good dividend.

Response

“Firstly, the COVID-19 pandemic required a prompt, decisive and ongoing response to ensure the health and safety of our people, the continuity of our business and the provision of support to our social partners and the government,” said Dlamini. The chairman said as the past year had been dominated by the ongoing COVID-19 pandemic, RES Corporation’s Risk Committee worked with management to prioritise the well-being of employees and their families, and had taken steps to assist local communities. “We have done everything possible to minimise the negative effects of the outbreak on employees and business operations,” he said. Despite having spent E38 million on healthcare services, 678 employees tested positive and seven succumbed to the virus, during the year under review. “We extend our deepest sympathies to their families,” said the chairman.

Dlamini said the devastating impact of the COVID-19 pandemic would continue until Eswatini achieved herd immunity through vaccination in the country and neighbours. He said until then, as a company, they would continue to follow the guidance and regulations required to keep their people safe and healthy and to preserve the sustainability of their business. Meanwhile, RES Corporation further expressed concerns over the high number of sick leave days of 7 502 (E4.2m) by 1 776 employees, considering the number of wellness interventions initiated by the company, but was also exacerbated by COVID-19.  “We are pleased to have been able to fulfil investor expectations in terms of cash returns, with the payment of dividends totalling E254.5 cents per share during the year,” said the chairman.

Meanwhile, RES Corporation Managing Director (MD) Nick Jackson said COVID-19 presented both disadvantages and advantages. He said the company’s employees and their families were affected in differing degrees, with 678 contracting the virus and 670 recovering. He said the pandemic made trading conditions extremely difficult for exports and for operations in relation to the movement of skilled personnel in and out of RES. “One of the positive outcomes was that RES produced 46 000 litres of sanitiser (80 per cent alcohol content), which was used internally for all staff and operations and was also donated to communities and regional health facilities,” said Jackson.

Safety

He said in response to COVID-19, the health and safety of people was paramount. Jackson said for that reason, they improved their own medical clinic, including piping in oxygen, purchasing ventilators and employing an additional doctor and five nurses.
“We also converted our country clubs into isolation facilities for employees who were unable to isolate at home. These amenities had individual rooms with en suite bathrooms, cooking facilities and full-time security,” he said. Jackson also said they changed the way they operated to comply with COVID-19 regulations. He said as they transported all their workers on a daily basis, they reduced numbers per vehicle and purchased extra vehicles.

Accommodation

Jackson said social distancing in the housing they provided was also a challenge, but they refurbished unused accommodation to meet the requirement. He said they added more washing facilities, sanitising stations and provided thermometers throughout the operations. Jackson also said each employee was provided with face masks, which were now a regular stock item. The MD said those who were not required to be physically on site, moved to work from home and the company developed a procedure to guide remote workers. “We embraced technology for meetings and engagements,” he said.

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