African agricultural company Agriterra announced its results for the six months to 30 November 2016 on Friday, with revenue from continuing operations falling to $8.1m from $9.4m year-on-year.
The AIM-traded firm posted a gross profit of $0.82m, down from $1.47m, although thanks to a larger profit on the disposal of property, it narrowed its operating loss to $0.77m from $1.55m.
Losses per share also narrowed, to 0.13 cents from 0.12 cents.
"The African agriculture market remains an area of growth potential, with Mozambique having particularly strong prospects because of the eagerly anticipated establishment of a liquefied natural gas industry in the north of the country," commented chairman Caroline Havers.
"As and when this industry gains sufficient development and production traction in Mozambique, it is expected to significantly change the economy of the entire country, which we believe will translate into consequential growth in our revenue potential."
Havers did add that in the shorter term, it needed to be acknowledged that the first six months of 2017 had been very challenging in Agriterra's primary grain and beef markets in Mozambique.
"In the immediate future there is also a potentially significant agricultural risk arising from an outbreak of fall armyworm in the Sub-Saharan Africa region, which poses a risk to various staple food crops, including maize.
"The outbreak is moving in a general North to South trajectory, and to date the most affected countries have been Zimbabwe and Zambia; there have been no confirmed outbreaks in Mozambique.
"Regional Governments are implementing measures to control the infestation, and the UN Food and Agriculture Organisation is assisting in a region wide response to this risk."
Havers said the board remained optimistic that the effect of this outbreak will be mitigated to the maximum extent possible.
She added that, as the board confronted market, economic and security issues, it was continuing to focus on identifying further cost savings wherever possible, improving the efficiency of its operations, implementing new products such as pelletised animal feed, and reducing the effect of the high interest rates by the early repayment of debt facilities in its beef division through the disposal of non-core assets.
"Taking account of the inherent operational, economic and political risks which our business has to address on an ongoing basis, we remain committed to developing our business so as to increase value for all stakeholders."