AFDIS revenue up 23pc

BH24 Reporter

HARARE – Listed spirits and wine manufacturer African Distillers Limited (AFDIS)’s revenue for the full year to June 30, 2018 jumped 23 percent to $30, 6 million.

The improved bottomline was a result of strong volumes growth during the period under review as the firm skated foreign currency challenges during the year.

“The company recorded a strong performance, notwithstanding supply constraints that emanated from severe foreign currency shortages,” said chairman Pearson Gowero in a statement accompanying the results.

The spirits segment was the major contributor to revenues, while Ready-To-Drink volumes (led by ciders) grew ahead of all other categories, up 23 percent on a year-on-year comparison.

AFDIS’ gross profit was up 32 percent, with the gross profit (GP) margin increasing from 48, 7 percent in FY2017 to 52, 2 percent in the period under review.

Earnings before interest and taxes (EBIT) was up 75 percent from the prior comparable period to $7, 1 million on improved margins attributable favourable mix advantages and cost containment measures implemented during the period under review.

The group listed a foreign exchange gain of $0, 3 million due to a weakening rand.

Profit after tax rose 90 percent to $5, 3 million with a PAT margin of 17, 2 percent compared to 11, 1 percent in the prior comparable period.

Earnings per share for the period amounted to $4, 53c.

Analysts at Akribos Research Services say the firm benefited from the increased use of plastic and electronic forms of payment, and will stands to benefit more if disposable incomes rise in the long-run.

“The Delta (Corporation) associate also continues to benefit from increased demand as a result of an upsurge in the use of electronic and plastic money.

“We note that in developed markets such as North America, alcohol categories such as wines and spirits are popular. In Asia for example, spirits constitute around 68 percent of the total alcohol consumption. In Sub Saharan Africa (including Zimbabwe), beer (clear and sorghum) is generally the preferred alcoholic beverage. However, this scenario is set to change as disposable incomes improve,” they said.

The board has declared a total dividend for the year of 1, 50 cents per share for the year, amounting to $1, 74 million.