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No dividends for Illovo Shareholders

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Shareholders of Illovo Sugar Malawi will have to wait a little longer to enjoy benefits of their part ownership in the company following an announcement that the company will not declare any dividends for the year ending March 31, 2017.

This is according to a statement of financial audited results for the period the company released recently.

The development has been attributed to cash flow constraints and uncertainty on market performance.

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“Despite some recovery in the overall commercial environment, particularly the domestic market, there remains uncertainty over the extent to which improvements in domestic and regional markets are sustainable.

“Taking into account the company’s high debt levels coupled with the high interest rate environment and the expected

level of cash generation for the full year, the directors will propose, at the forthcoming annual general meeting of members to be held on August 23 2017, that no second interim or final dividend be payable for the year,” the report reads in part.

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This is despite the company posting a profit of K7.1 billion in the year representing a profit jump of 279.67 percent when compared to the K1.87 billion revenue the company realised the previous year.

The report said Illovo defied a decline in production in the year to generate the high profit turnover.

“Final sugar production for the year totalled 239,951 tonnes, which was 11 percent lower than the 269,389 tonnes produced in the 2015/2016 milling season,” Illovo said.

The company, however, laments foreign exchange and interest rate movements which affected the business in the year under review.

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