Mthabisi Tshuma, Business Correspondent
ZIMBABWE’S largest beverages producer, Delta Corporation, has reported an increase in volumes across a number of its segments mostly due to the policy allowing use of foreign currency introduced at the start of the first lockdown in March last year.
In a trading update for the third quarter and nine months to December 31, 2020, the beverages manufacturing company said the stability of the foreign currency auction system and use of foreign currencies for domestic sales under Statutory Instrument 185 of 2020 resulted in stable pricing and consistent product supply due to better access to imported raw materials and spares.
“Lager beer volume grew 48 percent for the quarter and 20 percent for the nine months compared to the same period last year.
“The volume recovery is attributed to the competitive pricing and consistent product supply, benefitting from the injection of new returnable glass and fewer disruptions to production operations,” said the company.
“In Zimbabwe, the Sorghum beer volume grew 29 percent for the quarter but still trailed prior year by 14 percent for the nine months.
“There was improved market access following the relaxation of the lockdown measures during the quarter.
“The Sorghum beer category was negatively impacted by limited access to trade channels such as bottle stores and rural markets in the first half of the year.”
The volume at Natbrew Zambia declined by 2 percent for the quarter and is up 5 percent for the nine months.
The category has witnessed the resurgence of illegal trading in bulk beer which trades at a discount to packaged product.
The South African entity, United National Breweries, recorded a year-on-year decline of 19 percent for the quarter as South Africa has implemented very strict restrictions and bans on the sale and consumption of alcohol.
The total ban on alcohol sales was re-imposed at the end of December 2020.
Delta noted that sparkling beverages volume grew by 66 percent for the quarter and is up 42 percent for the nine months compared to prior year.
“The category has benefitted from consistent product supply and competitive pricing. The sales mix has shifted towards take-home packs in response to the restrictions on gatherings,” said Delta.
At African Distillers (Afdis), registered volume growth of 37 percent for the quarter and 25 percent for the nine months driven by the spirits and ready to drink ciders.
The beverages volume at Schweppes Holdings recovered and registered growth of 24 percent for the quarter but is down 2 percent for the nine months.
However, the company said the later part of the quarter was severely impacted by the restrictions to human and economic activity in response to the advent of the Covid-19 pandemic.
In Zambia, the economy experienced resurgent inflation and currency depreciation.
Meanwhile, the firm’s revenue for the third quarter grew by 77 percent in inflation adjusted terms (720 percent historical).
“Group revenue grew by 77 percent for the quarter and 33 percent for the year to date in inflation adjusted terms and by 784 percent and 837 percent in historical cost terms for the quarter and year to date respectively.
This reflects the significant volume recovery across all beverage categories and attention to replacement costbased pricing,” said Delta. — @mthabisi_mthire