Logistics group Grindrod has highlighted that it expects an improvement in its overall performance in the second half of the year as weather-related disruptions ease and rail capacity recovers.

CEO Kwazi Mabaso expressed this sentiment during the company’s pre-close investor webinar on June 24.

Reflecting on the past five months, he said that favourable operating conditions at the Port of Maputo, in Mozambique, had resulted in an increase in cargo volumes by 30% during the five-month period ended May.

However, he added that the performance at Grindrod’s Terminal de Carvão da Matola (TCM) in Mozambique slowed by 8%, mainly owing to adverse weather conditions between January and February that affected the Phalaborwa region in Limpopo, South Africa, where magnetite is sourced. Magnetite contributes about 70% of TCM’s total cargo volumes.

“The volume recovery process at TCM Matola commenced in March when rain subsided and will continue into the second half of this year,” Mabaso said.

The logistics segment was also affected during the five-month period, primarily owing to the closure of the Eswatini inland terminal, with Mabaso noting that this followed an increase in direct rail volumes from a mine to the terminal for a coal customer that had previously used the inland terminal.

Rail performance was further subdued by reduced locomotive deployment, which was affected by the closure of the Eswatini siding and weather disruptions on the Chikwalakwala line, which moves cargo from Zimbabwe to Mozambique. The line reopened in May, with Grindrod expecting improved locomotive deployment during the second half of the year.

Meanwhile, the company’s Bassopa safety awareness programme remained embedded across operations, contributing to a low lost-time injury frequency rate of 0.2 for the period. Mabaso noted that the company had, however, reported a fatality at a Durban stevedoring business in June.

He added that the incident reinforced the importance of continued safety awareness efforts as Grindrod worked towards achieving zero harm across all of its operations.

The port and terminal segment achieved an earnings before interest, taxes, depreciation and amortisation (Ebitda) margin of 38%, which was within the previously guided range of 35% to 40%. The logistics segment, excluding transport brokering, achieved an Ebitda margin of 15% during the period.

Moreover, Mabaso said Grindrod would intensify its focus on locomotive deployment in the second half of the year, supported by the reopening of the Chikwalakwala line and opportunities arising from South Africa’s rail open access process. He also noted that commodity prices for cargoes handled by Grindrod, including coal, chrome, iron-ore and spodumene, improved during the five-month period.

He added that the TCM expansion programme remained on track for hot commissioning in the first quarter of 2027. The rail open access process, including operational readiness activities, was also progressing, with a key milestone being the running of a test train before the end of the second half of this year. The company also aimed to resume train operations in the first half of 2027.

Meanwhile, Grindrod CFO Fathima Ally said the company would simplify its segmental reporting from the 2026 financial year, while retaining its core segments of ports, terminals, logistics and group.

Ally added that the private equity and property segment had effectively been realised, while Grindrod also reported the divestment of its marine fuels business in 2025. These previously reported segments would now be aggregated and included within the group segment.

“With the buy-up of the Matola asset within the previous financial year, Grindrod will no longer look to proportionately consolidate the joint venture (JV) performance on a line-by-line basis,” Ally noted.

She said reporting would align with how JV performance was reflected on Grindrod’s income statement, through a single line item showing the share of earnings from JV companies.