Delta posts impressive FY performance results
BEVERAGES producer, Delta Corporation, has recorded significant volume growth across all its segments in the financial year ended 31 March 2023 on the back of improved socio-economic activity.
The beverages producer operates segments that include lager beer, sorghum beer, sparkling beverages, wines, and spirits.
In a financial analysis presentation for the period under review yesterday, Delta chief executive officer, Mr Matlhogonolo Valela, said all segments grew as the company continues to drive a pro-growth strategy.
“As you see, all businesses grow. We have continued to drive a pro-growth strategy with interesting and exciting outcomes. The business momentum has continued growing volumes and earnings in spite of the challenges,” he said.
“We continue to take campaign risks as we see growth in value creation and at the same time, we are focused on shareholder distribution with an eye on shareholder return.”
Mr Valela said the lager beer segment recorded a first-ever volume of 2,2 million hectolitres, reflecting 17 percent growth from prior years’ volume of 1,9 million hectolitres. However, he said with that highest volume, the company disappointed the market in terms of brand and pack availability.
Therefore, he said they intend to add 33 percent more capacity in returnable glass production lines, which will add another 75 000 hectolitres, which will see them having four lines instead of three, which is set to be commissioned in June.
“That will allow us to supply the market better, manage trade, and pricing, drive volume growth and execute our revenue management strategy better because right now we are saying bigger is better driving the quart.
“We are not even focusing on trying to drive the small packs and trying to drive more products we sell, that will otherwise give us more revenue,” said Mr Valela.
The sorghum beer volumes grew from 3,7 million hectolitres in 2021 to 4,1 million during the period under review in Zimbabwe, from 1,3 million hectolitres to 1,4 in South Africa, and from 683 000 to 875 000 in Zambia.
Mr Valela said in Zimbabwe sorghum volume growth was driven by the marketing of cash crops, improved supply of Scud, launch of Chibuku Super Banana flavour, and utilisation of available regional capacity to cover supply.
He, however, said the Chibuku Super capacity was also compromised by water and electricity outages, operational challenges in formal retail and wholesale channels, as well as poor market access during the rainy season occasioned by bad road conditions.
Sparkling beverages grew from 1,4 million hectolitres to 1,6 million during the period under review. Mr Valela said in Zimbabwe market share has also grown across all the categories.
Meanwhile, Delta has recorded a 60 percent revenue growth of $536, 92 billion in inflation-adjusted terms and declared US$0,03 dividend per share during the period under review.