TOL Gases profit declines by 22 per cent

DAR ES SALAAM: TOL Gases has reported a 22 per cent decline in net profit for the year ending December, primarily due to unstable power supply and delays in plant equipment.

The company’s financial statement reveals that net profit decreased to 2.71 billion/- from 3.48 billion/- during the same period the previous year.

Harry Kitilya, Chairman of TOL Gases, explained that the profit decline was driven by several factors, including power shortages that significantly impacted operations.

“We experienced delays in the arrival of critical plant equipment, unreliable power supply and heavy rains throughout the year, which affected plant installation,” Kitilya said at the 29th Annual General Meeting (AGM) held in Dar es Salaam.

He noted that these issues delayed the commissioning of the Ikama II Carbon Dioxide (CO2) plant, which was intended to double production capacity.

The plant, initially scheduled to begin operations in September 2022, was delayed until December last year.

“The delay in commissioning the plant impacted our revenues, as we had a month without production.

This affected our working capital, liquidity and overall profitability for the year,” Kitilya added. Revenue also fell by 3.2 per cent, decreasing to 24.7 billion/- from 25.5 billion/- the previous year.

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As a result, the board of directors has decided not to recommend dividend payments for the year.

This decision will allow the company to reinvest its profits to support ongoing investments and create long-term value for both the company and its shareholders.

Additionally, total assets slightly declined to 54.4 billion/- from 55.9 billion/- recorded in the prior year.

Despite these challenges, TOL Gases remains committed to strengthening its market position and is preparing a five-year strategy plan for 2025-2029 aimed at achieving substantial returns in the near future.

Formerly known as Tanzania Oxygen Limited, TOL Gases is listed on the Dar es Salaam Stock Exchange (DSE) and has been a pioneer in Tanzania’s gas industry for several decades.

The company is 89 per cent owned by Tanzanians and is the leading manufacturer and distributor of industrial and medical gases in the country.

Established in 1950 as a branch of the African Oxygen and Acetylene Company (AFROX) of South Africa, TOL Gases became part of East Africa Oxygen Limited of Kenya in 1965, which was later integrated into the BOC Gases Group.