Volumes, a key indicator of demand, for Afdis rose 18% for the year ended 31 March 2023, compared to the comparative period, as it now focuses on cost cutting measures and improving manufacturing efficiency.
The company has since grown to become one of the largest producers and distributors of spirits, wines and ciders in the country.
In a statement accompanying the full-year results, group chairman Matlhogonolo Valela said volume growth was underpinned by the ready-to drink (RTD) segment, which grew by 23%.
On the other hand, wine and spirits volumes appreciated by 16% and 14% respectively.
“The increase in volume was due to improved product availability, increased market penetration and promotional activity,” he said.
Like any other business, Afdis was not spared from the vagaries of the adverse internal macroeconomic environment. These include exchange rate volatility, which has continued to put pressure on margins.
“The operating environment was complex and uncertain, characterised by high inflation, high interest rates, and increased power supply outages. Measures introduced by the government to reduce ZW$ liquidity resulted in relatively stable foreign exchange rates except at the tail end of the year where accelerated depreciation was witnessed resulting in increased value chain costs.
“The market witnessed an increased US dollar transaction flow which helped in sustaining the company’s working capital requirements,” Valela said.
According to the financials, the company’s inflation adjusted revenue was up 56% to $41 billion, while operating income increased by 15% to $5.4 billion.
“Cost containment measures were in place over the period, however, cost pressures were experienced in distribution, fuel and power, payroll and maintenance,” he said.
“In order to give context to the financial results, the Board estimates that, in United States dollars terms, revenue increased by 15% to US$49.4 million and operating income was at US$8.5 million.”
Given the difficulties in establishing US dollar values in the present climate, he said, users should use caution when utilizing these US dollar statistics.
The board has proposed a final dividend of US$593,137, or US$0.0050 per share. The total dividend was US$ 0.0075 per share after an interim dividend of US$ 0.0025 per share was paid in December 2022 – Harare