BEVERAGES manufacturing giant, Delta Corporation Limited has expressed skepticism over the impact of the forthcoming 2023 elections on the economy after recording strong volume growth in the current reporting period.
The fears have also been echoed by other industrialists who wish to see the obtaining exchange rate stability being sustained into the future but fear that authorities may abandon the efforts as they jostle for re-election.
Presenting the group’s report for the period ended September 30 2022, Delta chairman, Sternford Moyo added his voice to the concerns.
“Zimbabwe’s operating environment remains complex and challenging, particularly as the nation approaches the general elections in 2023.
“It is hoped that the stability of the exchange rate and the corresponding reduction in month- on-month inflation recorded since July 2022 will sustain in the short-term,” he said.
The fears were expressed shortly after the Reserve Bank of Zimbabwe (RBZ) governor John Mangudya told delegates on the sidelines of a function to launch the National Financial Inclusion Strategy that the obtaining economic stability and reform agenda will be sustained going forward.
Meanwhile, during the period, the company recorded strong volume growth across the product line.
The lager beer volume grew by 18% for the six months compared to prior year. Product supply has stabilised, benefiting from the injection of returnable glass bottles and the intense plant maintenance undertaken during the year.
Production capacity remains constrained and will be unlocked when a new plant is installed in the first half of 2023.
The sorghum beer volume in Zimbabwe grew by 14% for the half year compared to the prior year, with growth driven by the revival of the Scud pack.
The sparkling beverages volume grew by 22% over the previous year, attributable to increased market penetration of the returnable glass packs and better availability of packs and flavours.
In inflation adjusted terms, Group revenue increased by 63% to $207,8 billion reflecting the volume gains across business units.
“The Zimbabwe business recorded an increase in the contribution of foreign currency takings, which will support the ongoing recapitalisation programs. There is a focus on aligning the cash flows in each currency. The Group closed the period with net cash and cash equivalents of ZW$17,3 billion,” added Moyo. – Newzim
