ZIMBABWE – Dairibord Holdings, Zimbabwe’s leading processor of food and dairy has reported 17% growth in revenue in the first quarter ended April as compared to the same period last year.
The company indicated that overall volumes grew 8% above same period last year while demand was firm across all categories, reported the Herald.
During a trading update to shareholders, group chief executive officer Anthony Mandiwanza noted that company performance and particularly ability to meet demand was hampered by foreign currency shortages that have hard-hit Zimbabwe’s economy.
“There was increased competition, but demand for our products remained firm across all categories of the business.
“Foreign currency shortages negatively affected product supply.
We experienced a gap between supply and the ability to meet demand, consequently, demand was not met,” he said.
Several factors including inability to secure hard currency for critical imports such as spares, raw materials and equipment are reported to have impinged on manufacturing efficiency in Zimbabwe.
Among the manufacturers is Delta Corp which earlier said it was facing challenges securing about US$2 million per week needed to import concentrates used in Coca Cola soft drink manufacturing.
Despite of the challenges, Mandiwanza maintained the group anticipates demand to remain firm for the rest of the financial year on the back of an increase in disposable incomes as a result of the government’s move to increase salaries for civil servants by 15%.
For three consecutive years, Dairibord has overturned a US$351,000 loss position it recorded in 2014 on the back of erratic supply of utilities and high production costs.
During the full year to December 2017, the company managed 152% growth in net profit to US$1.3 million on volumes growth and restructuring exercises.
Although the heifer programme contributed 15% of the group’s total milk intake, the company said the management plans to halt the heifer programme citing foreign currency shortages and adopt the artificial insemination strategy.
In addition, it continues to cut on costs while optimising production to consolidate its market share.