Online Reporter
Nelson Gahadza
EARLY reporting season financial results from selected counters on the Zimbabwe Stock Exchange (ZSE) and the Victoria Falls Stock Exchange (VFEX) are pointing to a broad-based recovery anchored in volumes.
Diversified group Innscor Africa, retail concern Axia Corporation, quick service operator Simbisa Brands, British American Tobacco (BAT) Zimbabwe and property firm Mashonaland Holdings are among the first to publish their results, with most reporting double-digit volume growth in core segments.
Innscor Africa, reporting for the half year to December 31, 2025, delivered one of the strongest performances, with volumes rising across most of its operating units, underpinned by capacity investments and a relatively stable operating environment.
Group chairperson Mr Addington Chinake said the macroeconomic backdrop had been supportive during the period.
“The operating environment was broadly stable, supported by strong gold export earnings, improved agricultural output and tight monetary policy that contained inflation within single digits and steadied the currency,” he said.
Within the Mill-Bake segment, loaf volumes increased by 28 percent year-on-year following the commissioning of a new automated production line in Harare, highlighting the impact of recent capital expenditure on output.
At National Foods, overall volumes remained flat, but this masked a strong shift towards higher-margin product categories.
Flour volumes grew by 13 percent; downpacked products rose by 33 percent; snacks surged 71 percent, while pasta and cereals increased by 33 percent and 9 percent, respectively.
These gains were partially offset by an 11 percent decline in stockfeed volumes and a significant contraction in maize volumes.
In the same segment, Profeeds recorded 39 percent volume growth on improved capacity utilisation, Profarmer expanded its customer base by 24 percent, while Nutrimaster posted a 56 percent increase in volumes.
The protein segment also registered strong gains, with Colcom volumes rising by 32 percent, while Associated Meat Packers recorded 16 percent growth. Irvine’s table egg volumes remained flat due to a layer replacement programme.
Across beverages and light manufacturing, Prodairy volumes increased by 7 percent, and Buffalo Brewing Company’s grew by 17 percent.
ProBottlers, however, recorded a 17 percent decline in volumes, reflecting what the group described as a strategic shift away from high-volume, low-margin products, as well as the continued impact of the sugar tax on the beverage sector.
Overall, Innscor’s revenue rose by 19 percent to US$635,78 million, while EBITDA’s increased by 37 percent to US$80,37 million, with margins improving to 12,6 percent from 11 percent.
Profit for the period surged 66 percent to approximately US$54,98 million, supported by strong volume growth and improved operational efficiencies.
In a commentary, IH Securities said the performance reflected the success of Innscor’s investment-led growth strategy.
“Innscor Africa delivered strong volume growth in 1H26, reflecting the payoff from its capex-led growth model,” IH said.
“Continued investment in capacity and operational efficiencies should provide a partial offset to potential input cost pressures, while the group’s healthy balance sheet and robust cash generation support ongoing capex and strategic growth.”
The broking firm, however, cautioned on valuation.
“With the current share price trading above our target price, we believe the market has already priced in the exceptional first-half earnings momentum and the visible expansion pipeline,” it said.
Axia Corporation also reported strong volume growth for the six months to December 31, 2025, particularly in its retail segment, as competitive pricing and credit availability drove demand.
Group chairperson Mr Luke Ngwerume said revenue increased by 22 percent to US$122,03 million, driven by pricing strategies that stimulated demand.
The group’s flagship TV Sales & Home division recorded a 37 percent increase in volumes to 112 774 units, supported by strong festive season demand and promotional campaigns.
“Growth was primarily driven by the diverse and quality product range, competitive pricing and the availability of credit, which enabled more customers to acquire the products on offer,” said Mr Ngwerume.
Customer numbers increased by 33 percent, while the credit book grew by 70 percent over the same period, reflecting increased access to consumer financing.
Restapedic Bedding volumes rose by 26 percent to 32 315 units, supported by improved market penetration and expanded distribution channels.
Despite the strong volume performance, profitability growth remained constrained, with operating profit rising by 4 percent to US$15,32 million, weighed down by higher operating costs and provisions for credit losses in the distribution business.
Profit before tax, however, increased by 28 percent to US$8,81 million, while headline earnings per share rose by 5 percent to US0,61 cents.
The group also reported a significant improvement in cash generation, with net cash from operations rising by 239 percent to US$11,72 million, largely driven by festive season demand.
Market analysts say the early reporting trend points to improving consumption patterns underpinned by relative macroeconomic stability.
Investment analyst Mr Enock Rukarwa said volume growth across sectors reflects increased consumption in the economy.
“This reflects increased consumption within the economy, which has driven revenue growth in both the beverage and agro-processing sectors,” he said.
“Income levels have remained relatively stable, while inflationary pressures and exchange rate volatility have moderated. This has helped smooth consumption patterns across the economy.”
Mr Rukarwa said the outlook remains positive if current conditions persist.
“It is our expectation that this relative stability will persist in the foreseeable future, supporting consumption and potentially driving further growth as income levels improve,” he said.
BAT Zimbabwe, for its part, issued a trading update indicating that its financial results for the year ended December 31, 2025 are expected to show a material improvement in profitability compared to the prior year.
The company said the variance was significant enough to warrant a formal cautionary statement, in line with listing requirements, signalling a strong recovery in performance.
Meanwhile, Mashonaland Holdings reported steady growth in the property sector, with volumes reflected through improved occupancy levels.
Board chairperson Engineer Grace Bhema said the group delivered resilient performance in a mixed operating environment.
“Mashonaland Holdings reported an 8 percent growth in after-tax profit to US$4 million, driven by rising rental income, strategic land disposals and improving occupancy levels,” she said.
Revenue increased by 13 percent to US$8,1 million, supported by income from the disposal of residential stands and growth in rental income.
“Rental earnings climbed 12,6 percent to US$6,3 million, driven by improved occupancy across the portfolio, particularly in the second half of the year,” said Engineer Bhema.
Operating profit rose by 3 percent, weighed down by increased maintenance costs as the group prepared properties for new tenants.
However, Trigrams Investments analyst Mr Wafa Kuchera said consumption remains concentrated in essential goods.
“Consumption in the broader economy remains skewed towards basic household goods,” he said.
“From an investment perspective, we must follow the money and focus on companies that can convert consumer spending into meaningful returns.
“In this regard, beverages and agro-processing are best-positioned to outperform inflation in the short term.
Mr Kuchera warned that external risks could affect the outlook.
“The effects of the conflict in the Gulf region are likely to be delayed, but we see potential risks to inflation and currency stability if the situation persists, particularly through higher fuel prices feeding into retail costs,” he said.
Analysts also highlight that as more companies prepare to release their financial results, the early indications suggest that the market is entering a phase where volume growth, supported by investment and macroeconomic stability, is becoming the primary driver of performance, marking a significant shift in the earnings profile of listed firms.
Tinaye Agere