Dairibord Holdings experienced a mixed first half of 2024, with varied impacts from policy changes, production adjustments, and export growth.
The company faced increased production costs due to the implementation of a sugar tax, which added to the financial strain on beverage production.
These policy-driven cost hikes have contributed to the overall decline in beverage volumes.
Dairibord’s performance in the first half of 2024:
The Good:
Sales of liquid milks (Chimombe, Steri, Lacto) up 21% due to higher production from dairy farmers.
Farmers increased milk output by 22% to 55.1m litres over the half-year.
Dairibord bought 19.97m litres of this milk, 40% more than it did in the same period in 2023.
Dairibord has grown its milk market share from 28% in 2023 to 36%.
- The foods division was up 25%, driven by strong sales of Yummy yoghurt and ice creams, and a recovery from Lyons peanut butter.
Exports grew strongly, up 59%.
- Revenue up 13% to US$54.71m. Dairibord back in profit, swinging from last year’s loss of US$0.74m to a US$3.06m profit
The Not So Good:
Beverages sales down 8%. Pfuko was held back by the sugar tax and VAT measures, plus the lack of small change.
The rapid depreciation of the local currency before the arrival of ZiG resulted in net foreign exchange losses of US$3.3 million.
The drought may affect raw product supply this year.
