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FSC Records Disappointing Results

Weathers particularly the recent drought, has contributed to the low production of cane and financial performance of the sugar industry, says the Fiji Sugar Corporation chairman, Vishnu Mohan. At a
24 Nov 2017 12:01
FSC Records Disappointing Results
From left: Fiji Sugar Corporation Board chairman Vishnu Mohan, chief executive officer Graham Clark, and chief operating officer Navin Chandra at the press conference on November 23, 2017. Photo: Lusiana Banuve.

Weathers particularly the recent drought, has contributed to the low production of cane and financial performance of the sugar industry, says the Fiji Sugar Corporation chairman, Vishnu Mohan.

At a press conference following the FSC’s annual general meeting in Lautoka yesterday, Mr Mohan said they were also still feeling the impact of Tropical Cyclone Winston.

“Adverse weather conditions have drastically impacted cane development and subsequently reduced cane production in 2017,” Mr Mohan said.

“As a result, our initial target of two million tonnes of cane had to be revised downwards and we finally crushed 1.63 million tonnes of cane for 2017.

“Additionally, the prolonged drought has affected the growers planting schedule for next year’s crop. FSC will be working closely with the Sugar Research Institute of Fiji to ensure we get the most optimal yield possible.

“Cane development remains our most critical area of focus going forward, but the adverse impact of the weather in 2017 will impact negatively on our plans to grow our cane supply for 2018,”he added.

Productivity and gains

Mr Mohan said that FSC was working seriously to regain what they have lost in terms of productivity and financial gains.

“The Corporation’s share of proceeds in the financial year 2017 was $43 million compared to the $58.7 million in the previous year. The trading loss for 2017 was $18.5 million whilst the loss from operations was $39.6 million compared to a loss of $7.7 million and $26.1 million respectively for the previous year,”he said.

“FSC’s financial results for the financial year 2017 largely reflect the impact of TC Winston. The 2017 turnover declined by 38 per cent, however, the net loss improved by 18.5 per cent compared to 2016 financial year.

“The decrease in turnover for 2017 was mainly due to reduced production because of TC Winston on cane production, quality of cane and hence reduced sugar make.

Five year plan

He also introduced a five year plan that has been put in place to help with the FSC’s turnaround.

“A comprehensive five year (2018 – 2022) Strategic Plan has been established and has set out a restructuring plan focusing on cane production, as the platform for cash generation leading to FSC’s turnaround.

He said: “The Corporation has engaged the Fijian Government to consider and implement the conversion of current government loans of $173,816,930 to shares in FSC. And furthermore, to propose the acquisition of minority shares.

FSC has also engaged consultants to carry out a capital optimisation review to reduce current debts; and to source additional capital as equity or hybrid debt instruments for FSC,” Mr Mohan said.

Also at the press conference, FSC chief executive officer Graham Clark announced a five per cent wage increase for FSC workers.

“This hasn’t been done since 2014 and we thought it was time we did this. From here on all increase will be based on performance,” Mr Clark said.

Feedback:  lusiana.banuve@fijisun.com.fj

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