Delta full year earnings down 15% as beer sales decline

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DELTA Corporation, Zimbabwe’s biggest company, said full-year profit declined 13% after unemployment and delays paying government worker salaries hurt beer sales.

Net income was US$81 million in the year through March, down from US$93 million in the previous period, the Harare-based company said in an e-mailed presentation to analysts on Wednesday. Earnings before interest, taxes, depreciation and amortisation fell 10%. Delta is about 23%-owned by London-based SABMiller Plc.

Delta is battling weak consumer spending in Zimbabwe amid a crisis that has seen the economy shrink by about half since 2000. The company said last month it’s considering whether to drop its beer prices to tempt drinkers after full-year revenue fell.

Lager volumes declined 8% in the year, soft drinks by 6% and sorghum beer, made from a type of plant grown in Africa and used for food and biofuels, by 3%.

Sales of Delta’s Chibuku sorghum beer showed signs of recovery after price cuts, the company said. Additional capacity has been commissioned at the Chibuku brewery in Bulawayo.

The full-year dividend was raised 29% to 4,7 cents, after the company paid a special dividend of 0,95 cents.-Bloomberg

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