In reporting Universal Corporation’s results for the six months to the end of September, chairman, president, and CEO, George C. Freeman, III, said that during the second half of the company’s current fiscal year, sales of its African tobaccos would be impacted by reduced Burley production volumes in Africa, which mainly shipped in the third and fourth fiscal quarters.
“Less African Burley leaf was grown this fiscal year due to excess production and low grower prices in fiscal year 2017 and unfavorable weather conditions this fiscal year,” he was quoted as saying.
“Although we still expect our total shipments to be weighted to the second half of the fiscal year, we currently anticipate modestly lower total lamina sales volumes for fiscal year 2018.
“We are estimating that this fiscal year’s global Burley production declines will recover in next year’s crop.”
Meanwhile, Universal reported that net income for the six months ended September 30, was $29.7 million, or $1.16 per diluted share, compared with $19.8 million, or $0.54 per diluted share for the same period of the previous fiscal year.
Operating income for the six months ended September 30, of $51.5 million, was increased by $16.2 million on that of the first half of the previous fiscal year.
“Our results for the six months ended September 30, 2017, were in line with our expectations and reflected slightly higher total sales volumes and lower selling, general, and administrative costs,” said Freeman.
“In our second fiscal quarter, we continued to see the benefits of higher current crop sales and processing volumes and lower factory unit costs from the recovery in leaf production volumes this year in Brazil.”