AltX-listed Ububele Holdings on Wednesday said it aimed to encourage more scientific farming and resultant water savings in South Africa’s agriculture sector through the release of new water management systems.

The group, which held the sole rights for the distribution in South Africa of Austria-based Pessl Instruments technology, would, over the next year-and-a-half install 100 of these systems throughout South Africa, said Ububele CEO Bertie Cloete.

Four had already been installed since the company first brought the product to South Africa three weeks ago.

The technology, with a radius of between 5 km to 7 km, supplies farmers with up-to-date, accurate information regarding the volumes of water or moisture in leaves, soils, air and wind.

It also measures precipitation, wind speed and direction, atmospheric pressure, humidity and temperature, collecting all the data required for the efficient management of crops.

Cloete commented that the system could be linked to the farm’s irrigation system for full automation – when the crop has received sufficient water, measured by the Pessl instrument, the irrigation system switches off, preventing over-watering.

The weather monitoring system could potentially save a farmer between 50% and 60% on water costs, which would deliver further substantial savings in light of rising water costs and scarcity, he said.

“We consider water management to be a critical future resource focus area in Africa and believe that scientific farming is the only solution to the world's growing demand for food,” he said.

The information generated by the Pessl system could also be linked to the farmer’s cellphone or laptop.

The company had decided to bring in the technology following a two-year investigation into the success of the system in China and India.

Ububele also held the distribution rights to an American irrigation system called Hunter, through its R3.1-million, 51% acquisition of Turf-Ag.

Turf-Ag, which operates throughout South Africa, imports and distributes agricultural and turf irrigation equipment, supplies and products to the agriculture and turf market.

“Through our exciting agrochemical and biological product and service range, combined with our new investment in water management and irrigation, we are well positioned to assist our farmers to be more competitive and sustainable for the future,” Cloete commented.

The effective date of the acquisition is April 1.

Meanwhile, the firm reported a turnaround during the six months to December 2012, as Ububele progressed its exit from the food sector and into agriculture.

“The food sector accounted for 20% of the business, but 80% of the problems,” said Cloete, explaining that, as the retail environment became increasingly competitive, it would be more beneficial to exit the market and focus on the agriculture industry.

Ububele believed the emphasis on food security and the current high agricultural commodity prices made the agriculture sector potentially lucrative.

The company achieved profit for the period of R7.19-million, compared with the loss of R20.9-million recorded in the six months to December 2011.

Earnings a share increased to 2.76c in the six months to December 2012, compared with the loss a share of 13.54c in the half-year to December 2011.

Ububele generated revenue of R383.8-million during the first half of the financial year, up from the R340.1-million reported in the corresponding period the year before.

The cash generated from operations increased from R12.75-million in the comparative interim period in 2011, to R37.4-million in the period under review.

Ububele, as part of its turnaround strategy, disposed of its wholly owned Unique Dairy Products and Uni-Way Logistics for a combined value of R25.6-million.

“The disposal forms part of the company’s strategy to disinvest in the short- to medium-term from the food sector and divert all of its available resources and effort into the agricultural and services sectors,” Ububele noted.

The group also liquidated two food supply operations – Just Fruit & Veg and So Gourmet during the period.