HARARE, – Innscor Africa says its units had a mixed performance during the first quarter, with revenue falling marginally compared to same period last year, but gross margins were higher.
Chief executive Julian Schonken told shareholders at the annual general meeting that cost control generally remained good with further savings being achieved while profitability for the quarter largely met expectations.
“As a result headline earnings showed positive growth against the comparative period,” he said.
Notwithstanding the liquidity challenges Innscor was ‘extremely positive’ on the country’s economic recovery prospects and will continue with strategic investments, Schonken added.
“The business continued to invest in extending its pipeline of key raw materials. To this end, working capital increased by $9.3 million during the quarter to $88.3 million and we have a good pipeline of raw materials in most of our key categories at this point,” he said.
The transfer re-commissioning of an 80,000 loaf per day line from Harare to Bulawayo was completed, a month ahead of schedule and has allowed for increased capacity for the Southern region of the country.
“We look to start an upgrade of our lines in early 2018, resulting in better conversion efficiencies and increased capacities,” said Schonken.
Irvines remains in recovery phase following the Avian Influenza outbreak in the middle of the year. There have been no further outbreaks of the virus and the company expects the sites to exit the quarantine phase this month at which point re-stocking can commence.
Schonken said the business incurred a financial impairment charge of $2.04 million in July and this was mainly in respect of feed on the infected sites that was destroyed post the year-end. Table egg production remains at around 43 percent of normal capacity.
Probrands performance was hampered by the inability to source its full currency requirements for some of its key lines. Schonken said the UHT line has had a successful, albeit slow, start and its initial production teething issues have largely been resolved.