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FOOD processing group Cairns Holdings, whose sales in the first three months of this year rose by more than 17 percent, is close to finding a suitor, an official from the company has said.
The company, which is presently under judicial management, has of late been linked with a takeover bid by South Africa-based Vasari Global Holdings, an international private wealth, multi-asset investment firm.
But there have been doubts that the deal will sail through.
Cairns Holdings’ acting CEO Mr Jeremiah Kwenda has indicated that the company was determined to find an investor as it seeks to become a “food giant in the next five years”.
Buoyed by a 17 percent leap in sales in the first quarter, the company is now targeting to push sales volumes to 50 percent by year-end, riding on firm demand for corn snacks.
Volumes mainly grew in January and March but fell in February. Average monthly sales rose from US$1,7 million to US$2 million and are expected to rise to about US$3 million by the end of year.
In addition, Cairns’ average capacity utilisation has increased from 30 percent to 40 percent in the review period after the company purchased three machines from China last year as part of its retooling programme.
The machines, which have improved efficiency and quality, are being used to produce chips and corn snacks.
“We rationalised our basket to focus on high moving products. Capacity utilisation has also improved since last year,” said Mr Kwenda in an interview at the just-ended Zimbabwe International Trade Fair in Bulawayo.
He noted that while the operating environment remained tough, the company would perform beyond expectations by year-end, especially after re-opening the Mutare factory and re-introduction of discontinued products such as Sun Jam and baked beans.
Sun Jam will be toll manufactured in South Africa.
Part of the food processor’s product lines were affected by an influx of cheap imports.
Plans are, however, underway to re-introduce ProNutro and Marmalade Jam by the fourth quarter of the year.
Meanwhile, Cairns has embarked on a bean seed out-grower programme through which it aims to cut imports in the canned beans division in the next five years.
Under the project, Cairns procured haricot beans, which it planted at its Marondera farm and also distributed to smallholder farmers around the country.
Over the last decade, baked beans manufacturers have been importing haricot beans from Ethiopia, Malawi and Japan due to shortages in the country.
“Our plan is zero imports in the baked beans division; we want to add value to locally produced goods. Last year we got 24 tonnes which we treated and distributed to smallholder farmers.
We should be having stocks of the beans and reduce on imports, not just in haricot beans but other products like potatoes and groundnuts,” said Mr Kwenda.
Cairns is also working with communities in groundnut growing areas such as Chivhu, Mount Darwin and Gokwe to boost groundnut stocks and reduce imports.
Cairns presently employs 550 people compared to 1 200 workers at its peak.
Online Reporter