Distell: Zimbabwe unit’s turnover drops - Zimbabwe
IOL Business - Feb 15th 2016, 09:48
Harare - Distell’s unit in Zimbabwe declared an interim dividend of 0.15 US cents (2.36 SA cents) yesterday, despite an 8 percent decline in turnover that was partly offset by a 2 percent rise in wine and cider beer volumes as Zimbabweans switch to cheaper alternatives.
Zimbabwe is experiencing an economic downturn that has seen volumes for most companies take a knock and profits slide. This has been evident in the lager beer category, where SABMiller unit, Delta Corporation, has recorded declines over the past few quarters.
African Distillers (Afdis), which is jointly owned by South Africa’s Distell and Delta Corporation, yesterday said, “Cider and wine volumes continue to grow” in an economy where disposable incomes are declining and companies are cutting costs.
Although its spirits segment was lower, wines and ciders registered volume growth of 27 percent and 19 percent, respectively. The company competes in the Zimbabwean market with other imported brands, mostly from South Africa and other regional and international producers.
Pearson Gowero, the chief executive of Afdis, said that the rand’s fall had also helped gross margins improve.
He attributed the 19 percent decline in operating income “to the decline in revenue and insignificant gains realised from asset disposals” compared with the previous contrasting period.
“The decline was compounded by price reductions effected during this period aimed at stimulating demand and maintaining competitiveness. Gross margins improved due to value chain cost interventions as well as the depreciating rand,” he said.
However, turnover for the period declined 8 percent to $19 million, while operating income tumbled by 19 percent to $2.1m. This was despite sales volumes increasing by 2 percent to 3.9 million litres in a difficult market where consumer-spending power has been dented by job losses, company closures and the rising cost of living.
As a result, per share earnings in the company for the period fell to 1.38 US cents from 1.74 US cents in the year-earlier period, translating to a 0.15 US cents interim dividend. Payments to the government, through taxes, increased by $1m to $7.5m.
In yesterday’s trade on the Zimbabwe Stock Exchange, Afdis was 0.24 percent weaker after closing the day’s session at 50 US cents. However, analysts at brokerage firm Lynton Edwards said, “Turnover was up on yesterday (Wednesday – 10 Feb) buoyed by Afdis and Econet to $410 000.”
Foreign sales for Afdis stock amounted to $10 000 while there were no foreign purchases in the counter. There were no foreign sales in Delta while foreign purchases came in at $21 000.From © Independent On-line 2016. All rights reserved.
New friends and old favourites at the 36th Nedbank Cape Winemakers Guild Auction
07/08/2019 - 15:02
Lovingly-made Cape blends, new categories, first-of-their-kind wines, and rare varietals will be coveted by buyers from far and wide at the annual Nedbank Cape Winemakers Guild Auction this October.
Angola and Zimbabwe operations sap Distell earnings
07/08/2019 - 13:07
Beverages company Distell, whose brands include Nederburg wines and Three Ships Whisky, says earnings fell in the year to end-June as it took a hit on operations in Angola and Zimbabwe.
SA's best-loved beers revealed at Sunday Times Lifestyle Beer Awards
05/08/2019 - 14:24
CBC Amber Weiss was officially announced as South Africa’s Most Loved Beer at the Sunday Times Lifestyle Beer Awards in partnership with Makro on 2 August 2019, at an event in Johannesburg to celebrate the creators and retailers of local and internationally crafted beers.
All women team brew special beer to celebrate Women's Month
05/08/2019 - 10:38
SAB will be launching BOLD BREW– a beer designed and brewed entirely by women– this limited edition small batch beer is exclusively available at the SAB World of Beer in Newtown, Johannesburg.
How to sell your wine in a changing market
22/07/2019 - 09:56
The future of wine is evolving and the industry has to adapt in order to survive and flourish. This is according to Robert Joseph, an internationally respected wine expert and winemaker.