Zimbabwe: SABMiller’s Delta Corp. reports 10% sales drop in quarter through December

Delta Corp., the Zimbabwean brewer that’s the country’s biggest company by market value, said sales fell 10 percent in the three months through December as output of sorghum beer declined and consumer spending remained weak, Bloomberg reported on January 20.

Sorghum beer volume was down 1 percent in the quarter on lower supplies of the Chibuku Super brand caused by lower brewing capacity and power outages, Delta said in a statement on January 20. That reversed a surge in popularity for the drink due to its lower price tag than lager. Sorghum is a type of plant grown in Africa and used for food and biofuels as well as beer.

“The trading environment remains difficult as reflected by the subdued consumer spending during the traditional holiday peak period,” Delta said in a statement. The company is about 23 percent owned by SABMiller Plc, the London-based maker of Peroni, Grolsch and Castle lagers.

Zimbabwe’s economy is projected to grow 3.2 percent this year, according to the International Monetary Fund, from an estimated 3.1 percent last year, which was the slowest rate since contraction in 2008. The southern African country has been hurt by lower metal prices affecting the mining industry and declining foreign investment.

Delta said lager volumes were down 9 percent in the quarter, compared with a 20 percent fall for the nine months through December. The company is cutting prices to reflect a reduction in excise duty, it said.

21 January, 2015