Bright stars in Zimbabwe’s economic gloom
Zimbabwe is in the limelight for all the wrong reasons: the economy is struggling, companies are closing or scaling down and the government is making demands which are squeezing the few operational companies even tighter.
The Southern African country’s traditionally stronger and resilient c ompanies, s uc h a s SABMiller associate Delta Corporation, fastmoving consumer goods counter Innscor Africa and telecommunications g r oup Econet Wirele s s a r e a l l beginning to crack under the strain.
But two South African-controlled companies, Nampak Zimbabwe and African Distillers (Afdis), are showing that, despite the power outages hurting manufacturing, it’s not all bad news for Zimbabwe.
On 16 February, Afdis – which is controlled by Delta Corporation and SA’s spirits maker, Distell – reported rising volumes and a spike in profits for the six months to end December. The stronger performance by Afdis points to shifting beer consumption trends in Zimbabwe, which have left dominant brewer Delta Corp with reduced lager beer sales volumes over the past year, economists said.
Joel Mutizwa, chairman of Afdis, which manufactures spirits and ciders, said gross sales for the period grew 13% to $20.8m, while volumes were up 20% to 3.8m litres. Operating income grew 29% to $2.6m, while earnings per share rose 26% to $0.174. The improvements were partly due to cost reductions and a favourable rand exchange rate Cents 4 500
Mar ’ 14