- Simbisa to negotiate with suppliers on raw material prices
- Revenue increased by 7%, rising to USD 157.4 million from USD 146.7 million
- Plans to open ten new counters by June 2025, including six drive-throughs
Harare-Simbisa Brands Limited, the leading fast-food outlet listed on the Victoria Falls Stock Exchange, is set to enhance supply chain efficiencies and negotiate with suppliers on raw material prices as part of the measures to mitigate the financial impact of the newly introduced fast-food tax, effective January 1, 2025.
In his 2025 national budget, Minister of Finance Economic Development and Investment Promotion Professor Mtuli Ncube introduced a 0.5% tax on all fast foods which he later reviewed to 1% in his bid to widen the revenues nets.
‘’In the 2025 National Budget, Zimbabwe introduced a 1% tax on specific fast-food items, effective from 1 January 2025 and the Group is working on solutions to minimise the impact on menu prices whilst preserving margins.
‘’ These include enhancing supply chain efficiencies and engaging suppliers on raw material prices,’’ Chief Executive Officer Basil Dioniso said.
Meanwhile in terms of operations the group reported a 7% revenue increase, rising to USD 157.4 million from USD 146.7 million in the comparative period, with cash generated from operating activities up 39% to USD 29.3 million.
The Zimbabwean market saw a 4% year-on-year revenue growth, primarily driven by a 7% increase in customer count, however there was a 3% reduction in average spend due to the company's decision to lower prices in response to declining disposable incomes amid a tight liquidity policy.
In regional operations, Kenya achieved a 16% revenue growth in USD, fuelled by a 26% increase in real average spend, despite an 8% decline in customer count.
Four new counters were added, bringing the total to 255.
The Group closed with a total of 732 counters as at 31 December 2024, of which 611 are company-operated stores.
Meanwhile, Eswatini experienced a 2% year-on-year revenue decline in USD, with a 10% drop in customer count, partially offset by a 9% increase in real average spend, although profit margins remained stable.
Going foward, the company plans to open 10 new stores before June 2025, 6 of which will be drive-throughs, and has earmarked 12 locations for refurbishment by the end of fiscal year 2025 to significantly boost its delivery segment.
Currently, the company is exploring 64 potential new sites for expansion over the next 18 months, including 56 in Zimbabwe, six in Kenya, and two in Eswatini.
Simbisa has added 60 outlets to its refurbishment program, focusing on its more mature store network in Zimbabwe.
To optimize delivery efficiency, Simbisa is leveraging technology, pursuing exclusive delivery agreements, and implementing targeted marketing strategies to meet increasing demand for delivery services.
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