National Foods which is the Zimbabwe’s top food processor, has reported that volumes for the 3 month period between July and September went up by 25.6% ahead of the same period last year owing to strong consumer demand across all operating units. In the full year to June, volumes grew by 7.1%
The company said it experienced a continuation of the positive demand trend which emerged at the end of the previous financial year. National foods’ financial year runs between July and June of the succeeding year.
The company which is an associate of ZSE listed Innscor and JSE listed Tiger Brands, said the maize unit increased by 55% driven by a lower maize harvest relative to last year. Maize produce in the country has been dampened by lower rainfall.
The stockfeeds division saw a recovery in volumes by 44%, emerging from a year over which avian influenza outbreak negatively influenced volumes.
In an aside with Equity Axis CE Lashbrook said the company expects to have fully rebuild stock-feeds capacity by 2020. In the interim performance of the unit will largely be impacted by forex availability. The unit demands $2 million in forex on a monthly basis.
The flour unit is reported to be operating at full capacity and that it would have increased volumes had the capacity been available. Snacks operations realized a 44% increase volumes.
The company said profitability for the quarter was largely in line with expectations. In the full year to June 2018, Natfoods revenue grew by 3% which was its slowest growth in 5 years weighed by underperfomance at the maize and stockfeeds units.
The company which controls 75% of the flour milling market share, said it continues to engage the RBZ for funding o its wheat imports.
On macro developments Natfoods said it has since adjusted prices following inflationary pressures particularly on imported items.
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