INDUSTRIAL conglomerate Delta Corporation has posted a turnover of $13,5 trillion during the year to March 31, 2005 despite a significant decline in volu
mes and production constraints at its carbonated soft drinks plant during the period.
Volumes for the period, down 15% on the previous year, suffered from relatively soft demand for beverages as a result of an erosion of disposable incomes, sensitivity to the pricing in sorghum beer and an acute shortage of carbonated soft drinks.
Board chairman Robbie Mupawose said the shortage of soft drinks during the year, widely seen as symptomatic of the deepening six-year economic crisis, had been caused by “difficulties encountered in clearing outstanding foreign currency debts”.
“The matter has been dealt with and production has been fully restored, but the high imported content of this range will continue to present challenges,” Mupawose said in his report accompanying the financial results.
The group’s acquisition during the period, Ariston Holdings, experienced strong demand for its products, and production and price levels had improved during the year, although the low exchange rate applicable to a portion of the company’s export proceeds had constrained profitability.
Mupawose said from a group point of view, the acquisition of Ariston had “yielded a steady flow of foreign currency” which has been largely applied to clearing outstanding creditors.
During the period under review, attributable income surged 427% to $2,8 trillion. While gross margins had improved slightly during the period, overheads had increased ahead of inflation, impacting negatively on attributable earnings.
The overheads had soared due to wage settlements which were higher than inflation and the impact of currency rates on fuel and spares.
Headline earnings per share surged 398% to $2 435.