Dairy and food processor, Dairibord Holdings’ performance in the four months to April was above the same period last year with revenue growth at 17 percent ahead of prior year. In a trading update to shareholders at the group’s annual general meeting in Harare yesterday, group chief executive officer Anthony Mandiwanza said raw milk uptake was 8 percent above same period last year.
Overall volumes growth was also 8 percent ahead of prior year comparable period. Demand was firm across all categories.
Mr Mandiwanza, however, indicated foreign currency shortages currently affecting the economy had a knock on effect on the group’s performance especially its ability to meet demand.
“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.
During the period under review, the bottom-line was slightly above same period last year and management is upbeat of a strong earnings performance for the first half of the current financial year.
During the full year to December 2017, Dairibord overturned a loss position with 152 percent in net profit to $1,3 million from a $5,4 million loss in the prior year, on volumes growth and restructuring exercises.
Revenue for the year improved 10 percent to $103 million on volumes growth due to a firming demand.
Total volumes increased 8 percent to 89,4 million litres as the firm leveraged on improved installed capacity.
Mr Mandiwanza said the group anticipated demand to remain firm for the rest of the financial year on the back of an increase in disposable incomes.
Government recently announced a 15 percent salary increase for civil servants, which ultimately should improve disposable incomes and consumer spending.
Management has also indicated the group would continue on a cost containment strategy while optimising production to consolidate its market share.
During presentation of 2017 financial results recently, management also said the group would halt the heifer programme citing foreign currency shortages and adopt the artificial insemination strategy.
The heifer programme has contributed 15 percent of the group’s total milk intake.