Sound results for Afdis

Sound results for Afdis
Published: 17 February 2014
African Distillers (Afdis) Limited turnover grew by 11%, whilst volumes declined by 2% in 2013, owing to the tough economic environment, the company said in a commentary accompanying its half year results for the year ending December 2013.

Despite challenges of diminishing disposable incomes due to tight liquidity, the wine and spirits maker realised high revenue growth due to favourable sales mix which had a positive impact on trading margins resulting in an increase of 2%.

Earnings before interest taxes, depreciation and amortisation (EBITDA) increased by 30% to $2,2 million.

The company said the local product portfolio continues to grow enhancing revenues and margins with the ready to drink products steering the growth of the business operations.

The wine marker said localisation of production of ciders was now at an advanced stage and machinery for production had been ordered and would be operationalised in the first half of the financial year, to reduce the importing and distribution of cider products from South Africa.

The company however failed to pay dividends as it is still seeking for funds to carry out capital projects.

"No dividend is being recommended for the half year ended 31 December 2013 as the company still requires funds to undertake capital expansion projects," said the company.

Afdis said it would continue to strengthen its brand portfolio by investing into the business.

"The company is targeting sales growth and increased profitability into the future through cost effectiveness and improved production and capabilities," said the statement.

Afdis is expected to commission its $5 million refurbished manufacturing plant in June and work is currently underway to put together the equipment.

Subsequent to the period under review, the company raised $5 million from a rights issue to fund the manufacturing plant project and from the proceeds, $1,5 million was used to repay shareholder loans.

Afdis currently has six depots operating mainly in Bulawayo, Harare, Kwekwe, Masvingo, Mutare and Victoria Falls.
- zimmail
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