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Joseph Mutizwa

Business Reporter
PROFIT for wines and spirit manufacturer, African Distillers Limited (Afdis), went up by over 150 percent to about $2 million over the past financial year.
According to the Zimbabwe Stock Exchange-listed concern’s results for the year ended June 30, 2014, the company registered a $2,077,531 profit compared to $808,767 in the same period last year.
Despite the negative macro-economic environment characterised by slow consumer spending and tight liquidity conditions, Afdis posted a 0.45 cents dividend per share and is focusing on consolidating its revenue growth.

Total assets value rose to $19.5 million from $13.9 million as the company consolidated its strength.
The company’s board chair Joseph Mutizwa said Thursday in a statement accompanying their results that growth was driven by firm demand for brown spirits in the second half of the year.

He said: “The year’s volumes at 6.1 million grew 10 percent on prior year. Local product portfolio contributed 71 percent, up from 58 percent last year.”
Mutizwa said earnings before interest and tax grew by 80 percent to $3 million with gross margin spiking 47 percent high.

“This is a result of a favourable product mix dominated by a significant increase in brown spirits volume,” he said adding, “EBIT margin improved from seven percent last year to 13 percent, indicating strong retention of value created.”

Mutizwa said the firm’s net finance costs scored 30 percent below last year due to improved cash holdings during the latter half of the year.
He added earnings per share grew 2.01 cents from 0.85 cents.

Mutizwa said the recapitalisation of the company was successfully undertaken in January this year adding that an additional 15,451,174 shares were issued at a price of $0.3236.

He said the funds raised would be channelled towards a project to localise the production of ciders expected to commence this month.
Mutizwa said while trading conditions remained hostile, the company would continue focused on volume and revenue growth while containing costs and improving its operational efficiency.

African Distillers Limited is the manufacturer, distributor and marketer of branded wines and spirits for the Zimbabwean market and export.
It has six depots in Bulawayo, Harare, Kwekwe, Masvingo, Mutare and Victoria Falls.

These are supplemented by ‘cash and carry’ operations in Bulawayo, Mutare and Harare.