Kruger said Senwes had not escaped this and the impact was clearly visible in spending on agricultural equipment.
“Add to this a build-up of maize surpluses over the past two seasons and below-average pre-season rainfall, and it is evident that material challenges will have to be faced in the current season,” he said.
The Senwes Group’s interim financial results for the six months ended 31 October 2018 reflected this, with profit after tax at R156 million, which was 6,8% higher than the previous year. Normalised headline earnings increased 0,7% to 98,5cents per share. An interim dividend of 30 cents per share was declared compared with 27 cents in 2017.
Kruger added that the positive cash flow of R152 million was generated from operating activities after the payment of a final dividend of R47 million for the 2018 financial year, and the payment of financing costs amounting to R99 million.
According to Kruger, the second semester of the year will probably be even more challenging due to the late rain, as well as lower than expected capital spending.