Dairibord has reported “significant” business recovery in the third quarter as the COVID-19 lockdown eased and forex access improved, but sales remain lower than last year.
Consumer companies have been among the hardest hit by COVID-19. Incomes, already strained by the economic crisis, have been eroded further, while supply chains were disrupted.
The latest update by the country’s biggest dairy company shows that while there has been some recovery from the lockdown period, consumers are still spending less than they did in 2019.
Dairibord said demand significantly improved in the three months to September. Sales volumes grew 32% ahead of the second quarter.
Sales for all its products have improved. Foods saw the biggest turnaround, up 74%, while milk and beverages rose by 15% and 50% respectively.
Volumes for the quarter were still 10% below the third quarter of 2019. However, a good sign for Dairibord is that this was a smaller drop than the 46% decline recorded in the second quarter of this year.
In the six months to June, sales volumes had fallen 32% below the same period last year.
“The operating environment for the three months to 30 September 2020 showed improvement on the back of foreign currency exchange rate stability, reduced month on month inflation and relaxation of COVID-19 lockdown restrictions,” Dairibord says.
“The introduction of the foreign currency auction system and Statutory Instrument 185 of 2020 (allowing sales in forex) improved foreign currency availability and stability resulting in enhanced planning, efficiency and value preservation.”
The company has made 50% more foreign currency since the start of the year than it did over the same time last year.
Dairibord is optimistic about the last three months of the year: “The improved performance achieved in the quarter is expected to continue into the final quarter of 2020 as the local and regional economies show signs of recovery.”
Dairibord accounts for 38% of the national milk intake, making it the largest dairy producer.