Beverages manufacturer, Delta Corporation Limited, says it has remained viable at the peak of Covid-19 restrictions, which saw governments in Zimbabwe, Zambia and South Africa, where the company also has operations, tightening screws on the sale of beer.
Governments across the globe imposed lockdowns as part of measures to curb the spread of Covid-19, a development that negatively impacted on business.
In a trading update for the third quarter and nine months to 31 December 2020 released this Thursday, company secretary, Alex Makamure, said they remained viable despite the threat posed by the pandemic.
“The report on volume and financial performance above indicates that the business has been able to sustain its viability during the peak of the Covid-19 restrictions,” said Makamure.
“There are many uncertainties that make it difficult to fully estimate the full impact of the Covid-19 pandemic on the financial health of the company and group entities.”
He said group revenue grew by 77% for the quarter and 33% for the year to date in inflation adjusted terms and by 784% and 837% 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 cost-based pricing,” he explained.
“The group has benefited from the improved access to foreign currency through domestic Nostro sales. The foreign currency is being prioritised towards settlement of the legacy debts in line with the arrangements with the Reserve Bank of Zimbabwe. Steady progress has also been made in the settlement of the loan for the acquisition of UNB (SA).”
Lager beer volume, Makamure said, grew 48% for the quarter and 20% for the nine months compared to the same period last year, adding the recovery was attributed to the competitive pricing and consistent product supply, benefiting from the injection of new returnable glass and fewer disruptions to production operations.
“With on-premise consumption curtailed, there are ongoing efforts to promote at-home consumption in line with the COVID-19 guidelines,” he said.
“In Zimbabwe, the Sorghum beer volume grew 29% for the quarter but still trailed prior year by 14% 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.”