The Sunday News
Rutendo Nyeve, Business Reporter
LISTED manufacturing, retail and financial services companies last week continued to release their trading updates for the quarter that ended on 30 June 2022, as well as consolidated financial statements that reported significant growth owing to a number of measures implemented by the Government and private sector.
Trading updates refer to the quarterly announcement of the company’s sales and expansion results for the preceding quarter while consolidated financial statements show aggregated financial results for multiple entities or subsidiaries associated with a single parent company.
Beverages companies Delta Corporation and African Distillers limited released their trading updates for the first quarter last week, noting that the trading environment during the quarter under review was characterised by increased social and economic activity as the Covid-19 restrictions and curfew times were progressively relaxed.
The updates further note that regional economies are being impacted by increases in global inflation, a surge in fuel prices and disruptions to international shipping which are driven by the Covid-19 impacts and the Russia/Ukraine conflict.
However, consumer uptake and spending remains high reflecting faster velocity of the local currency and spurred by increased mining activity, infrastructure projects, marketing of commercial crops and payments of wages and salaries in foreign currency. This has led to the companies registering significant growth both in their volumes and revenue.
“Group revenue grew by 55 percent for the quarter in inflation adjusted terms compared to growth of 283 percent in historical cost terms. This reflects the volume growth and the replacement cost-based pricing. The business remains cash generative with the cash flows supporting the capital expenditure programs and to build stock covers ahead of the coming peak season,” said Delta Corporation Company secretary Ms Faith Musinga in the update.
African Distillers company secretary Mrs Lydiah Mutamuko said:
“The Company registered a volume growth of 18 percent for the quarter compared to the same prior year period, benefitting from improved product supply into the market and increased outdoor activities as the Covid-19 restrictions were relaxed. Wine volume grew by 30 percent over prior year mainly driven by 4th Street wine due to improved availability and affordability following the commissioning of the brand’s local production. Spirits and Ready to Drink (“RTD”) volumes grew 23 percent and 12 percent respectively as a result of strong demand and increased market penetration. Revenue for the quarter grew by 57 percent in inflation adjusted terms over last year, whilst in historic terms grew by 285 percent. Revenue growth in both financial reporting sets was due to improved demand and inflation related adjustments.”
Meanwhile, in a statement released last week, listed clothing and merchandise retailer Edgars stores Zimbabwe chairperson Mr Thembinkosi Sibanda said notwithstanding the challenges in the operating environment, the group managed to close 2021 with an improved performance over the year.
“The Group reported Revenue of $6.9billion which is 82.5 percent up from that achieved in 2020 of $3,7 billion. Profit before tax of $590 million was a significant improvement from the prior period loss of $290 million. This is a demonstration of the various initiatives implemented by management to ensure fresher stock was available in our stores. The group achieved a basic earnings per share of 97,49 cents 2020: (78,89 cents). Total Group units sold increased by 4,1 percent from 2,4 million to 2,5 million compared to the same period last year. 2021 saw our Manufacturing concern, Carousel, recording its first export sale to Botswana, bearing testament of management’s initiatives to continuously explore alternative markets,” said Mr Sibanda.
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He said trading in foreign currency since April 2020 allowed the retail chains to improve stock assortments, which in turn increased traffic in their stores. Not to be left out on the list was listed supermarket retail group OK Zimbabwe which registered a significant profit before tax of $4,8 billion which is 38,5 percent up on prior year’s $3,8 billion.
OK Zimbabwe chairperson Mr Herbert Nkala in a statement on the consolidated financial statement said:
“Sales volume grew by 22,7 percent over prior year. In inflation adjusted terms, revenue for the year grew by 34,7 percent to $79,9 billion from $59,3 billion in the prior year. Profit before tax of $4,8 billion was 38,5 percent above prior year’s $3,5 billion while profit after tax grew by 48,9 percent to $2,8 billion from $1,9 billion in prior year.”
Fintech Ecocash Holdings Zimbabwe’s group revenue also reportedly closed at $29,9 billion, 26 percent above the financial year 2021 performance of $23,8 billion, according to a performance statement released by the board chairperson Mr Sherree Shereni.
Despite the challenges prevalent in financial year 2022, EcoCash Holdings Zimbabwe Limited delivered a commendable performance once again, with the Group’s revenue closing at $29,9bn, 26 percent above the financial year 2021 performance of $23,8 billion. — @nyeve14
