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FSC Out of the Red Zone Soon

FSC Out of the Red Zone Soon
Fiji Sugar Corporation chairman Vishnu Mohan (right) and chief executive officer Graham Clark (left) at press conference on Tuesday, May 15, 2018. Photo: Charles Chambers
May 16
11:00 2018

The Fiji Sugar Corporation has made a remarkable re­covery since a new team of executives from the chairman to chief execuitve officer took over in 2017.

Now the company is looking at getting out of debt.

FSC chief executive officer Gra­ham Clark during a press confer­ence yesterday said the day was coming close for FSC to revert from “red to black.”

Good progress has been made especially with the financial per­formance of FSC this year and the company is forecasting a further reduction in its net loss for the 2018 financial year.

FSC chairman Vishnu Mohan said this had been attributed to improve­ments in operational and factory ef­ficiencies as well as a rigorous ap­proach to cost control throughout the company.

The company’s five year Strategic Plan saw increasing cane produc­tion as the continued key focus this year, creating the platform for cash generation which will drive a posi­tive turnaround for the industry and FSC.

It was also highlighted that the recent damages to sugar cane farm and mill equipment during the re­cent cyclones and floods would have a small impact on the initial out­look, both for profits and forecasted amount of crops.

Prior to the floods, the industry was quite optimistic in regards to 2018 cane production estimates, at a forecast of 1.9 million tonnes of sugar.

This forecast has been revised to 1.7 million tonnes after the devasta­tion of the April floods.

Mr Clark said whilst this revised figure was below the initial fore­cast, it was still higher than 2017 actual production figures by 100,000 tonnes.

He added that the production of sugar and controlled costs are ex­pected to cushion the drop in cane production.

Mr Mohan said 2017 will be re­membered as a year which saw FSC heralding in a new era of trans­formation, at Board level through to Executive Management and throughout the company.

Mr Clark said this transformation continues today as the company adapts to a changing environment.

FSC gears up for new season

FSC has set its sights towards building a robust sugar industry as it gears up for the 2018 crushing season and believe the time is com­ing soon for this to happen.

Last year, total cane crushed in­creased by 18 per cent however Mr Clark said this was still a disap­pointing result, reflecting the dam­age of Cyclone Winston in 2016 and floods and drought in 2017.

“Sugar production increased by 29 per cent and TCTS improved by nine per cent.

“At national level, mill stoppages recorded a decline of 21 per cent and 19 per cent in Inside and Out­side stops respectively,” Mr Clark said.

Highlights of the past year includes:

nIn December 2017, FSC employ­ees received a five per cent wage increase as a cost-of-living-adjust­ment and benefitted 1928 employees across FSC’s four mills.

n10 of FSC’s senior mill engineers graduated from India’s Vasant­dada Sugar Institute which saw the culmination of three-years of advanced mill operations training, designed to enhance factory perfor­mance and responses to mill break­downs and stoppages, to ultimately reduce factory downtime.

nIn January this year, a $3.05 per tonne special cane payment was paid to our growers in time for the start of the 2018 school year.

The payment was in line with an announcement by the Prime Min­ister Voreqe Bainimarama, made in October 2017, of a final special cane payment to growers for the 2016 crop. This payment excluded deductions which was great news for growers.

n$30 million repairs and upgrades to our sugar mills which was to improve operational capabilities of the mills, so that FSC is bet­ter prepared for future growth. Major renovations are being car­ried out at the Lautoka Diffuser plant which would enhance the sugar extraction process.Refur­bishment and repairs were also be­ing carried out in the Rarawai and Labasa Mills, to improve factory productivity.

nMr Bainimarama also launched the company’s Tractor and Imple­ment fleet in late March 2018.

The 30 tractors and implements have been dispatched to FSC’s sec­tor offices nationally.

There are more mechanisation de­velopments to come later this year, including mechanical harvesters and haulage trucks.

Meanwhile two cyclones in early April saw an impact on the indus­try with widespread flooding across the sugar cane belt.

The impact of the floods affected many growers, who up till that point, had on many accounts, been gearing up for a good year.

Mr Clark said the Rarawai Mill was impacted extensively with huge amounts of silt and debris left in the mill area.

Resilience and efforts of his work­ers in getting the mill back into shape and which would now delay the beginning of crush by only a week.

Feedback: charles.chambers@fijisun.com.fj

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