Delta boosts govt revenue

HARARE - Delta Corporation (Delta) is one of the country’s biggest tax payers, with $400 million having been paid over the past three years, Finance minister Tendai Biti has revealed.

Biti said Delta’s contribution to Treasury was a huge sign of confidence and belief to the Zimbabwe brand at a time when the country only managed to attract $350 million in Foreign Direct Investments (FDI) in 2011.

Zimbabwe has been for the past decade struggling to attract FDI due to perceived political risks, controversial government policies and arrears to the international moneylending institutions.

“This investment comes at a time when our country is on the road to economic recovery,” he said while officially commissioning Delta’s $17 million bottling plant in Southerton, Harare.

“We in government are confident that this recovery will gather momentum in the years to come. We are convinced that Zimbabwe is an attractive investment destination.”

Biti said a total of $158 million was accrued to government through excise duty, Vat and income tax from the beverages business for the year ended March 31, 2012.

“This compares to $73,8 million profit after tax and dividends of $24,7 million in the same period. We applaud this significant contribution to the fiscus,” he said.

Delta’s new machine purchased from Krones, Germany can produce 42 000 pint bottles per hour or 25 000 quarts an hour.

The plant also has capacity to do the 340ml green bottles as well as a special feature to do Castle Lite six packs.

Canaan Dube, chairperson for Delta said the latest investment was part of its expansion plans, and the newly installed machinery had capacity to run returnable and non-returnable glass bottles.

“This investment will enable the company to significantly improve supplies and eliminate the current intermittent shortages of some product lines,” he said.

Dube said Delta, which last month became the first Zimbabwean company to reach the $1 billion market capitalisation on the stock exchange, was also investing in new fermentation vessels at both the Southerton and Belmont lager plants.

“This will cost in excess of $4 million, and the impact will be significant as it will place us in a position to adequately meet lager demand for the foreseeable future,” he said.

Dube said Delta will soon launch a new product under the traditional beer brand.

“Plans to add a new product to our Chibuku brand are well advanced and we are ready to launch a new product on the market.”

The plant has a capacity to produce 600 000 hectolitres per annum, which, Dube said, will boost the total national capacity to two million hectolitres.

Zimbabwe has a per capita consumption of around 14 litres per annum (for beer excluding sorghum beer) and 11 litres per annum (for sparkling beverages), which are low by developing world standards, which yields extensive growth potential for Delta in view of its capacity growth.

The beverages company has invested over $250 million since February 2009 as part of its recapitalisation programme, which is transforming the company into a world-class competitor creating jobs and generating revenue for government.

Market observers say while the manufacturing industry is reeling under low capacity utilisation, the beverage industry is operating above 70 percent hence the increased investment. - John Kachembere

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