Delta revenue tumbles 8pc
LISTED beverages company, Delta Corporation, has recorded an eight percent drop in revenue for the second quarter ended September 30, 2016 on the back of weak volumes and depressed consumer demand.
Low disposable incomes coupled with the continuing loss of jobs and delays in payment as well as prevailing cash shortages across the country have generally crippled spending patterns on many products, surveys have shown.
In an update, the listed firm said yesterday that the trading environment continues to be constrained by depressed consumer spending, limited access to cash and the generally weak macro-economic performance.
“Trading patterns remain inconsistent. The shortages of foreign currency resulted in reduced importation of consumer goods leading to an increase in demand for some of our product lines,” it said.
The corporation also said it was faced with production disruptions due to an emerging risk on water supply as a result of depleted dam and groundwater sources.
“Revenue is six percent down for the quarter and down eight percent for the six months, which is in line with the changes in product mix and pricing decisions.
“Lager beer volume is seven percent below prior year for the quarter and 11 percent down for the six months,” it said.
However, sparkling beverages volumes were up by three percent for the quarter and down by three percent again in the six months to September.
Meanwhile, sorghum beer volumes increased by four percent in the quarter and six percent for the six months.
“The contribution of Chibuku Super remains strong. The delays in payments to foreign supplies resulted in the late commissioning of the new plants at Masvingo and Kwekwe, which are now expected to contribute to production before the end of the calendar year,” it said.
Recently, Delta said it anticipated no changes to its relationship with its new shareholders after regulators approved principal owner, SABMiller’s takeover by Belgium-based brewer, AB InBev.
SABMiller owns 38 percent Zimbabwe associate.
However, the shareholders approved the takeover by Anheuser-Busch InBev last September for $104 billion in one of the largest corporate deals in history. — @okazunga of the
Delta Corporation has recorded an eight percent drop in revenue