Delta posts strong Q1 FY22 results, all key divisions deliver

  • Lager beer volumes grew by 139%
  • Sparkling drinks posted 205% improvement
  • SA subsidiary recorded 361% growth
  • Massive growth against low comparative base in 2020

Harare – Zimbabwe’s biggest beverages manufacturer and marketer, Delta Corporation Limited has posted strong volumes and financial performances in their first fiscal quarter ended 30 June 2021 when compared to the same period in the prior year which was immensely affected by COVID-19 lockdowns.

“Volume performance in the prior year first quarter was significantly curtailed by the onset of hard lockdowns in response to the COVID-19 pandemic during the first wave. The high growth rates recorded in Zimbabwe for first quarter of F22, in comparison to prior year, partly arises from the low prior year base,” the company said in a trading update for the quarter.

In the period, lager beer sales volumes scaled up by 139% which the company accredits to competitive pricing, consistent product supply and the use of returnable glass.

Sorghum beer volumes were on the same trajectory, posting an increase of 106% in the quarter despite reported hiccups with packaging material.

“There were some constraints in the supply of key packaging materials due to poor availability of and logistical challenges on resins on world markets.”

In the same vein, sparkling drinks volumes climbed up by 205% asserting a recovery in market share that has largely been taken over by Varun beverages who manufacture Pepsi and Pepsi-related products.

The company’s subsidiaries African Distillers Limited and Schweppes also saw volumes growths of 47% and 44% respectively.

Meanwhile, the company’s South African subsidiary, United National Breweries, registered an overall 361% volumes growth in the quarter, when its put against the same one in the prior year, which is a very low comparative base as there was very little business activity in the country at the time because of a ban on the sale of alcohol put up as part of the lockdown restrictions.

“The business was largely closed in 2020 due to the ban on alcohol sales. The recovery has been curtailed due to the re-imposition of alcohol ban at the end of June 2021 in response to the third wave of COVID-19 infections,” Delta said.

The Zambian subsidiary, Natbrew however, saw a 29% decline as a result of the business being hampered by illegal bulk beer sales in the country.

This overall strong performance translated into a 114% revenue growth for the company in inflation-adjusted terms.

Going forward, however, Delta sees the lockdowns put in place in the region to curtail the spread of the third wave of COVID-19 hampering business in all the nations in which it operates but expects the bumper harvest to benefit the Zimbabwean units.

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