DAIRIBORD Holdings Ltd sees a 12% growth in turnover this year compared to last year supported by the group’s heifer programme, which is expected to augment milk supply, a company official said.
Dairibord kick-started its milk supply development programme during the fourth quarter of last year by importing 250 heifers. The heifers were allocated to 10 farmers across the provinces.
The move by the company follows a similar one by Nestle Zimbabwe that saw the Swiss-controlled multinational investing US$14 million into the importation of 2 000 heifers.
National milk supply remains low against demand but players in the dairy industry believe it is government’s responsibility to promote it.
Zimbabwe has the highest producer price for milk in the world at between 55-59 US cents a litre against 35-39 US cents a litre in South Africa, 18-20 US cents in Uganda, 28 US cents in Kenya, 22 US cents in US and 14-21 US cents in New Zealand.
Chief executive Anthony Mandiwanza told an analysts’ briefing on Wednesday the group expects milk supply to grow 10% above last year.
National raw milk production was up 6% while the group’s intake was up 8% on the back of the milk supply development initiative.
In the year to December 2012, the group’s revenue grew 11% to US$106,9 million on the back of a 10% increase in volume.
Operating profit however was down 10%. The group’s FD Mercy Ndoro explained this was because group had not adjusted consumer prices against rising operating costs.
Mandiwanza said volumes had been driven by an increase in capacity utilisation on ice cream and peanut butter, but liquid milk volumes had not been able to grow because of supply constraints.
He also said the group’s Malawi operations had suffered following a cocktail of problems, among other things, the devaluation of the Malawian Kwacha and power outages. Raw milk intake was 10% below last year as they had been unable to collect milk timely.
In terms of the revenue streams, Mandiwanza said these were evenly spread over the three key portfolios; milks, foods and beverages.