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Judith Phiri, Business Reporter
FOOD manufacturing giant, National Foods Holdings Limited has embarked on an expansion drive which will see the firm entering into a number of new business lines as it seeks to value add its portfolio of basic products.
This was revealed in the Group’s financial results for the year ended 30 June 2022, with the company noting that many of its products which had previously been imported will now be manufactured locally.
“The Group is embarking on an exciting period of expansion with entry into a number of new categories as it seeks to value add its portfolio of basic products. Many of these products will see the localised manufacture of products which had previously been imported, reducing foreign currency requirements and increasing demand for locally grown produce,” said National Foods.
“Our team remains intensely focused on delivering a range of quality, healthy and affordable products which ultimately will offer improved choice to local consumers.”
The company which is into flour and maize milling, biscuits, stock feeds, snacks, cereals, pure oil and down packing has diversified into pasta production to increase its market share.
The Group said so far 80 percent of its local products were in high demand, hence the need to do more projects.
“From an economic policy perspective, the Group welcomes and supports the recent interventions which have greatly improved economic stability. With the improved stability, we would support a progressive easing of some of the measures, such that consumer spending can recover, albeit in a more stable inflationary environment,” added National Foods.
The company said its management teams will continue to focus on ensuring its business models are robust and fit for purpose, while particular focus will be placed on volume growth, cost optimisation as well as ensuring that working capital deployed in each unit is appropriate for the economic circumstances.
Recently, National Foods said it has spent US$13million on both of its plants, with US$5,6 million spent on the pasta line plant and US$7,7 million on the biscuit line.
The company also recently launched Pearlenta Smart Carbs meals, and all-day instant cereals to increase health benefits for consumers.
The Group said: “The installation of the new mill at our Bulawayo site has commenced and the mill remains on track for commissioning early in 2023. The new mill will increase wheat milling capacity by around 2 000 tons per month.”
In terms of the financial performance, National Foods said volume for the period increased by 8 percent to 569 000 tonnes when compared to the previous year.
The revenue for the year increased by 33 percent to ZWL$ 128.4 billion, driven by both volume growth and inflation driven price increases.
“Gross profit grew by 84 percent in absolute terms, mainly due to inflationary gains on raw material positions. Operational expenditure grew by 37 percent year on year, with correction of some major cost lines occurring in real terms during the year.”
The company said operating profit increased by 301 percent compared to the previous year to ZWL$ 14.74 billion.
National Foods said the statement of financial position remains in a healthy position, with adequate resource to fund the expansion phase which the Group has embarked on.
In terms of final dividend, the board declared a final dividend of US$5.95 cents per share (2021: ZW$ 296.49 cents per share) in respect of all ordinary shares of the company bringing the total dividend to US$5.95 cents per share and ZW$1 103 cents per share (2021: ZW$1 099.76 cents per share).
“This dividend is in respect of the financial year ended 30th June 2022 and will be payable to all the shareholders of the company registered at the close of business on the 11th of November 2022. The payment of the final dividend will take place on or around the 25th of November 2022.”
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