Online Reporter
Sikhulekelani Moyo Zimpapers Business Hub
Zimbabwe’s largest beverage manufacturer, Delta Corporation Limited, has revealed that the group benefited from economic stability in the second half of the year, with strong consumer spending supported by a firm exchange rate.
In a statement accompanying the group’s unaudited financial results for the period ending 30 September 2025, group chairman Mr Todd Moyo said the prior year comparative period was affected by the disruptions to trading during the implementation of the route to market policies, sugar tax-induced price increases for soft drinks, and the impact of drought on disposable incomes, particularly for rural markets.
He said there were also pricing distortions arising from policies on the pricing exchange rate, which have since been removed.
“The group benefitted from a relatively stable operating environment during the half-year period under review,” said Mr Moyo.
“Consumer spending remained strong, driven by a stable ZWG exchange rate, the record-breaking tobacco marketing season, increased mining activities, and the firm mineral prices, particularly gold.
“Diaspora remittances are also benefiting from the firming of cross exchange rates such as the Rand and Pound, our key source markets.”
Mr Moyo added that the informal sector continues to grow on the back of operational challenges impacting the formal retail and fast-moving consumer goods (FMCG) sectors and the varied applications of the route to market regulations.
“The authorities continue to implement policies to reduce informalisation and clamp down on illicit trade and smuggling, which has assisted the uptake of some of the group’s product lines,” he added.
“Retail transactions are largely in foreign currency cash as consumers avoid high transaction costs and the Intermediated Money Transfer Tax.”
He said South Africa reflects modest but meaningful growth in consumer and retail sectors, driven by lower fuel prices and interest rate cuts.
He, however, said the market will remain constrained by structural issues of high unemployment, energy constraints, and fiscal pressures.
“The Rand has stabilised below 18 to the USD amid concerns about a fragile coalition government and pressure from global economic factors,” he added.
“There is discernible spending on fast-moving consumer goods, value goods, and online channels. The Zambian economy is benefitting from moderating inflation, growth in mining and agriculture, and a gradual increase in electricity generation, which uplifts household spending, but overall consumer spending remains cautious.”
Meanwhile, Mr Moyo said the group revenue for the half year at US$514 million increased by 32 percent compared to the prior year.
This reflects the volume growth across the Zimbabwe business units and the inclusion of Schweppes as a subsidiary.
“The revenue growth was weighed down by the price moderations in the Sparkling Beverages business, which partly absorbed the sugar tax to maintain volume and competitiveness,” said Mr Moyo.
“The proportion of domestic sales undertaken in foreign currency was 92 percent during the period under review.”
“Operating income is indicated at US$99,6 million, which was 54 percent above the prior year. Profit before tax is indicated at US$104,8 million compared to US$55,8 million for the prior year.
“There was some improvement in trading margins arising from lower cereals and packaging material costs, currency movements, and higher throughput, which was, however, eroded by the under recovery on the sugar tax.”
Delta Beverages and Schweppes Zimbabwe paid an equivalent of US$15 million as sugar tax during the half year, compared to US$16,5million in the prior period, an untenable situation versus earnings generated in this category.
Mr Moyo said engagements with the Government are continuing to avoid the inevitable damage to the category going forward.
