HARARE - National Foods Holdings Limited (National Foods) profit surged by 20 percent in the year to June 2014 to $16,7 million from $13,9 million recorded prior year on the back of increased sales volumes.
The group’s chairman Todd Moyo said the company recorded an eight percent volume growth compared to the previous financial year.
Total volumes sold in the period under review were 538 000 metric tonnes representing 48 percent of capacity utilisation.
“Despite continually reviewing pricing in order to remain competitive, the group’s margin grew fractionally to 23 percent,” said Moyo.
He added that while the deficit in locally grown maize, wheat and soya beans remains, the company was compelled to maintain long future priced pipelines of imported raw materials which can affect National Foods’ margins in periods of commodity pricing volatility.
“A non-recurring profit of $1,5 million was realised on the disposal of some property assets. Overall profit before tax achieved of $21,7 million was therefore 26 percent higher than the previous year,” said Moyo.
Headline earnings of $15,4 million achieved in the period under review were 17 percent higher than prior year while the group’s revenue increased by 11 percent from $309 million in June 2013 to $343 million.
A total of 8,18 cents dividend was declared.
The impressive set of results released by National Foods comes on the back of the company recently reopening its Mutare maize mill which had been inactive for the past six years.
Jeremy Brooke, the national Foods chief executive said the company was delighted to bring back into service the mill which has largely been under care and maintenance since Zimbabwe introduced multi-currency trading in 2009.
Brooke said reopening of the mill would help meet the demand for Red Seal roller meal and Red Seal Pearlenta as well as create employment.
The plant will complement operations at the Harare and Bulawayo plants to ensure nationwide availability of Red Seal roller meal and Pearlenta.
Brooke said the company had secured maize from Mozambique that would be milled in Mutare to help ensure adequate roller meal and Pearlenta between now and the harvesting of locally produced maize.