Spirit of drinking continues despite economic woes
AFRICAN Distillers says revenue for the first quarter ending June was up 57% despite the weakening of the Zimbabwe dollar as social and recreational activities increased following the easing of Covid-19 regulations.
The trading environment for the quarter under review was challenging due to the depreciation of the local currency and rising inflation which exerted pressure on the company’s pricing.
The company changed its financial year in 2021 from June 30 to March 31 to align with Delta Group which had acquired additional shareholding, resulting in it being a subsidiary.
“The company registered a volume growth of 18% for the quarter compared to the same prior period, benefiting from improved product supply into the market and increased outdoor activities as the Covid-19 restrictions were relaxed,” reads a statement accompanying the Q1 trading update.
“Wine volume grew by 30% over the prior year mainly driven by 4th Street wine improved availability and affordability following the commissioning of the brand’s local production . Spirits and Ready-to-Drink volumes grew 23% and 12% respectively as a result of strong demand and increased market penetration.
“Revenue for the quarter grew by 57% in inflation-adjusted terms over last year, whilst historic terms grew by 285%. Revenue growth in both financial reporting sets was due to improved demand and inflation related adjustments.”
Going forward, the company says rising inflation and rolling power cuts will have an impact on the business.
African Distillers Limited is a public quoted company whose core business is the manufacture, distribution and marketing of branded wines, spirits, liqueurs and ciders for the Zimbabwean market.
The company was established in 1944 and its activities originally centred around the sale and distribution of imported spirits, liquors and wines. Local production of a range of spirits commenced in 1946 and African Distillers Limited became a public quoted company in 1951.-STAFF WRITER.