Spirits maker-African Distillers Limited (Afdis) extended its full year profit ended March 2023 thanks to improved product availability, increased market penetration and promotional activity which boosted volumes.
Revenue was 418 percent up in historical terms to ZW$ 34.2 billion from ZW$ 6.6 billion previous year.
Volume growth was strong at 18 percent above prior year mainly driven by Ready to drink (“RTD”) segment which grew by 23 percent. Wines and Spirits volumes grew by 16 percent and 14 percent respectively.
The market witnessed an increased US$ transaction flow which helped in sustaining the Company’s working capital requirements.
To give more meaning to the results, the group said in United States dollars terms, revenue increased by 15 percent to US$49.4 million and operating income was at US$8.5 million.
The company embarked on promotional activity to regain market share from cheaper and illicit products.
“The operating environment was complex and uncertain, characterized by high inflation, high interest rates, and increased power supply outages,” the group said.
Measures introduced by the government to reduce ZW$- 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 for the company.
“The trading environment is envisaged to remain challenging and uncertain, however, it is also anticipated that there will be opportunities for business growth. The Company will continue leveraging on ensuring full product availability, market share protection and brand portfolio expansion for business growth. Focus will also be on production efficiencies and cost containment initiatives.”