Delta Corporation reports 58% growth in full year revenue driven by volume growth in most segments

ZIMBABWE – Delta Corporation, Zimbabwe’s largest beverage company, has reported a 58% growth in revenue in inflation adjusted terms for the year ended March 31, 2022 to ZW$109.5 billion (US$302m) from ZW$69.3 billion (US$119.4m).

Over 50% of its revenue in Zimbabwe was in foreign currency enabling better availability of imported inputs supply.

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The group recorded earnings before interest and tax (EBIT) of ZW$25.4 billion (US$70m), 37% above prior year with the growth attributed to the volume recovery, replacement cost based pricing and ongoing cost management measures, according to the company.

Its lager beer volume for the year grew by 38% compared to prior year, attributed to consistent product supply with respect to both brand and pack.

During the period under review, a new brand, Sable Lager, was launched in March 2022, to expand our mainstream offerings and offer consumers a choice of an easy drinking lager.

The sorghum beer volume in Zimbabwe grew by 43% for the year on improved product supply, market pull and the resurgence of our returnable scud bottle.

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Its other sorghum beer producing operations in neighbouring countries showcased a mixed bag of performance as the volume at Natbrew Plc in Zambia declined by 16% for the full year due to limited access to the market under COVID-19 restrictions and resurgence of competition from the illegal bulk beer offerings.

The nascent volume recovery was dealt a blow following the hike in excise duty in January 2022. There are however concerted efforts to stabilise the business through focused product offerings and enhanced distribution strategies.

In South Africa, United National Breweries, benefited from the lifting of the alcohol ban to record a volume increase of 63% over prior year.

Other than registering growth in the beer category, its subsidiary manufacturer of branded wines, ciders and spirits recorded a 37% increase in volume compared to prior year driven by a strong market pull and better product supply.

The last quarter of the year was affected by the shortages of glass bottles for ciders resulting in product shortages especially the Hunters brand.

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The wine category was adversely affected by limited trading in the on-premise consumption channel during hard lockdowns.

Shifting focus to the soft beverage segment, sparkling beverages volume grew by 65% over the previous year while beverage volumes at Schweppes Holdings Africa Limited, grew by 22% over prior year, driven by improved product supply and market recovery of the Minute Maid Juice drinks which were not available in the previous period.

Its other operations, Nampak Zimbabwe witnessed sustained strong demand across its business sectors with the packaging divisions being buoyed by the volume recovery in the beverages sector.

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