Timothy
Business Writer
Improved consumer demand has continued on a positive trajectory, driving up National Foods Holdings volumes across all categories during the group’s first quarter FY2022) spanning from July to September 2021.
The food concern, in a trading statement, said the agricultural recovery plan that saw high maize volumes in the 2020/21 harvest and the 2021 wheat harvest currently underway, has been the drivers of the group’s growth matrix.
“The agricultural recovery is most welcome, as the requirement for imported raw materials will decrease significantly, reducing the burden on the fiscus and improving household incomes,” National Foods said.
The company said following a period of relative stability in the economy, the last few months have seen an upturn in inflation and generally more challenging business conditions.
“Whilst our optimism regarding the future of the economy remains, the period ahead needs to be carefully navigated to sustain the recent economic gains,” the company noted.
During the period under review, Group volumes increased by 24 percent compared to the same period last year to 143,000 tonnes.
In terms of each category’s performance, flour volumes increased by five percent compared to last year as demand remained firm and the mills ran at capacity for most of the period.
The stockfeed volumes increased by 29 percent compared to last year, as demand for poultry feed continued to remain firm, notably from small scale producers.
The company noted that in the maize unit, there was a recovery in volumes which increased by 25 percent over the same quarter last year.
“This was an encouraging outcome as demand is normally muted following a good harvest, and reflects the impact that imports had on demand last year,” it said.
The company added that demand for Pearlenta Nutri Active instant porridge continued to increase, with volumes growing by 75 percent compared to last year.
“For the newly established Down-packed unit, which houses the rice, salt, sugar beans and popcorn categories, volumes continued on an upward trajectory, increasing by 59 percent when compared to last year.”
The group indicated that the snacks demand was encouraging, as the Covid-19 induced lock-downs eased, recording an increase of 81 percent over the prior period.
Elsewhere, the biscuit category grew 16 percent compared to last year, as the plant ran at maximum capacity.
National Foods said its two major capital development projects are on track, with the Bulawayo Flour Mill scheduled for commissioning late in 2022 and the Harare Breakfast Cereal plant scheduled to be completed by the second quarter of 2022.
The group said it expects that volumes will show continued growth compared to prior year. However, the company noted that some of the recent economic challenges can be addressed, in order to slow inflation and restore general business confidence.
Bongani Ndlovu