Afdis’ earnings soar as volumes surge

Harare – Zimbabwe Stock Exchange – listed alcoholic beverage maker, African Distillers Limited (Afdis) has reported a 17% increase in sales volumes for the year ended 30 June 2019 on prior year, largely from the first half to December 2018.

Spirits increased by 21%, Ready-to-Drink (RTDs) by 18% while wine registered a decline of 10%.

“Product innovation within the gin and vodka segments significantly contributed to the overall spirit category volume growth,” the company chairperson Pearson Gowero said in a statement.

Revenue grew by 98% to ZWL60.6 million compared to ZWL30.6 million in the prior year while operating income scaled up 257% to ZWL25.4 million in the period under review from ZWL7.1 million recorded in 2018.

Mr Gowero said the growth in operating income is a result of volume upsurge, supply chain cost management and inflation driven price adjustments.

In view of the currency changes, the Company advised stakeholders to exercise caution especially on the statement of profit or loss and other comprehensive income (SOCI) which complies with SI 33/19 but is not in line with International Financial Reporting Standards (IFRIS) as it is a summation of different currency values at the time of trade.

In line with the growth in revenue and operating income, profit for the year jumped 243% to ZWL18.1 million compared to ZWL5.3 million in the prior year.

Gowero said in order to ensure business continuity, the central bank provided a facility to one of the Company’s major foreign suppliers amounting to US$22.5 million in line with the Exchange Control Directive RU 28 of 22 February 2019.

The board declared a final dividend of ZWL1.50 cents per share resulting in a total dividend of ZWL4.50 cents per share for the year, amounting to ZWL5.3 million.

On the outlook, Mr Gowero said affordability is likely to be a challenge going forward in the face of the deteriorating macro-economic conditions.

“The Company will continue to seek opportunities to protect market share and enhance shareholder value,” he said.

Equity Axis News

Raynold Mhotseka

Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment. He can be contacted through the following email links, rayjnr.mhotseka@gmail.com and raynoldm@equityaxis.net.

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