Beverages manufacturer, Delta Corporation has urged government to engage with stakeholders before major policy pronouncements to maintain market confidence.
Delta, the second largest company by market capitalisation on the Zimbabwe Stock Exchange after Econet Wireless, said latest policy pronouncements by the central bank were contrary to its earlier promises.
“Post the end of the reporting period, the fiscal and monetary policy pronouncements have been dampened by the currency policy statements which seem to contradict the previous undertakings by the Reserve Bank of Zimbabwe on the multicurrency framework,” Delta company secretary Alex Makamure said in the company’s trading update for the half year to September 30 released yesterday.
“In addition, the 2% transaction tax took both business and consumers by surprise, raising policy risks and undermining market confidence. Government and regulators are urged to engage stakeholders ahead of major policy pronouncements in order to maintain market confidence.”
In the period under review, revenue increased by 33% for the quarter and 37% for the half year, driven by higher sales in the beer business.
“Lager beer volume grew by 52% over prior year for the quarter and is up 54% for the six months,” Makamure said.
“There are some frictional shortages of brands and packs occasioned by the limited production capacity and raw material supply issues.”
Sorghum beer volume in Zimbabwe grew by 9% above prior year for the quarter and 2% for the six months, while there was an improvement in the supply of packaging materials for Chibuku Super.
However, Sparkling beverages sales declined by 14% compared to prior year for the quarter and grew by 3% for the six months, mostly due to a shortage of foreign currency which led to extended periods of production stoppages and out of stock situations.
National Breweries Plc – Zambia recorded a volume growth of 13%, in response to the volume recovery initiatives which focus on packs and competitive pricing.
Makamure said the business performance reflected the relative impact of the import content requiring hard currency in each business segment.
Since the announcement of the separation of current accounts into foreign currency dedicated accounts called nostro foreign currency accounts (FCAs) and real time gross settlement (RTGS) FCA accounts, companies have responded by hiking prices while others closed down over pricing uncertainty.
- Newsday
