Delta revenue surges 19pc
DELTA Corporation reported a 19 percent surge in revenue in US dollar terms for the quarter ended December 31, 2023, compared to the same period last year.
The positive momentum extends across the broader year, with year-to-date revenue climbing 12 percent.
The impressive performance is attributed to robust volume growth across all business units, further bolstered by a strategic focus on US dollar sales, which averaged above 70 percent for the year, the country’s largest beverages company said.
Building on strong volume growth, the lager beer business surpassed historical monthly peak volumes, achieving a 15 percent increase in quarterly sales and a 14 percent increase for the nine months compared to the prior year.
The commissioning of a new packaging line in August 2023 played a key role in stabilising overall product supply.
This, along with the introduction of returnable glass bottles, secured key raw materials, and a reliable manufacturing platform, has further boosted supply stability.
Delta said the focus remains on aligning brand and packaging availability with demand while optimising the route to market.
Under the sorghum beer segment, overall volume in Zimbabwe, including exports, increased 3 percent for the quarter and 4 percent for the year-to-date.
However, sorghum beer domestic sales dipped 5 percent due to increased lager beer availability.
The new Chibuku Super plant in Harare stabilised supply for both local and regional markets.
In South Africa, UNB SA saw a 10 percent quarterly volume increase and 3 percent year-to-date growth.
Chibuku Super continues its expansion into formal channels, with local production now expected in the fourth quarter.
Zambia’s Natbrew delivered a 23 percent quarterly and 50 percent year-to-date volume surge, followed by a slowdown after an October price increase. The cholera outbreak, rising maize costs and the depreciation of Kwacha further impacted the market.
The sparkling beverage category maintained its strong volume recovery, surging 38 percent for the quarter and 25 percent year-to-date compared to the previous year.
This momentum, according to Delta, was fuelled by competitive retail pricing and increased availability of diverse flavours and packaging options.
December 2023 even saw the highest monthly volume ever recorded for the unit.
However, the sector faces headwinds in the form of unavoidable price hikes due to the upcoming sugar tax implementation. This is on top of existing market pricing distortions.
Associates Performance
Afdis saw a 12 percent volume decline in the quarter, hit by increased grey market activity for key brands and weaker uptake from formal partners due to account management issues and market pricing distortions. Plant breakdowns and utility disruptions further hampered production.
Schweppes bucked the trend with a 16 percent volume surge, riding the wave of its new plant commissioned in November 2023, bringing bottled water and Minute Maid juices to market.
However, according to Delta, the impending sugar tax poses a threat to their volume recovery through price hikes.
Nampak Zimbabwe reported an 8 percent overall volume increase, lifted by paper product exports and higher demand for plastic packaging from the beverage sector.
Despite ongoing challenges with raw material shortages and power disruptions, focus remains on meeting customer demand and controlling costs.
To reflect the current operating environment and comply with International Financial Reporting Standards, the board has adopted US dollars for presenting the 2024 financial statements, effective October 2023.
While effort have been taken to accurately represent the group’s financial performance and position, inherent limitations exist in translating Zimbabwean dollar financial information.
Delta noted discrepancies may arise due to potential misalignments between the Consumer Price Indices and exchange rates used in the conversion process and the actual rates applied in the underlying financial transactions.