Delta records $32,3m profit

HARARE - Zimbabwe Stock Exchange listed blue-chip counter, Delta Corporation (Delta), has registered a $32,3 million profit in the half year to September, up from $30,9 million recorded in the same period last year.

The group’s chief executive, Pearson Gowero, said the business remains profitable despite operating in an environment mixed with both challenges and opportunities.

“The inability to remit foreign payments and constrained payment methods impacted negatively on the trading environment while the improved agricultural out-turn and small scale mining spurred consumer spending.

“There is heightened nervousness about currency risk and the value of monetary assets occasioned by higher liquidity on the RTGS platform and depleting nostro balances.

“This is driving up valuations across available investment classes as evidenced by the bull-run on the Zimbabwe Stock Exchange,” Gowero said, adding that there is an urgent need for fiscal consolidation.

In the period under review, Delta’s cash generation with lager beer volume went up 11 percent to 676 hectolitres on prior year with a volume mix in favour of value packs and brands.

“Sparkling beverages were flat on last year’s 667 hectolitres while Maheu grew 19 percent.

“Sorghum beer is down 4,0 percent affected by the transactional challenges in the rural markets and the trading up to lager beer,” he said.

Delta’s revenue in the six month period increased by 1,0 percent to $250 million on prior year driven by higher volume of lager beer with operating profit and EBITDA both down 4,0 percent reflecting the contribution of value packs and brands in the mix.

Gowero noted that the higher contribution of finance and associate income resulted in attributable income growth of four percent above prior year.

“Included in cash balances is $39 million with respect to unremitted dividends due to foreign shareholders which together with reduced working capital resulted in net cash rising to $182,9 million,” he said.

Going forward, the conglomerate said it would continue to seek sound investment opportunities and capital projects to optimise its cash balances and protect capital, while delivering a sustainable yield to shareholders.

“Little change if any is expected in the operating environment to the end of the financial year,” Gowero said.

The former SABMiller subsidiary declared an interim dividend of $2,25, which is a 13 percent increase from $2,00 recorded in the prior comparable period last year.

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