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E-Malt.com News article: Zimbabwe: AB InBev yet to receive US$70 mln Delta dividends
Brewery news

Anheuser-Busch InBev (AB InBev) — the world’s largest brewer — is yet to receive a total US$70 million in dividends from its Delta Corporation investment owing to delays by the local central bank to settle international payments due to the prevailing chronic liquidity crunch and cash crisis, the Zimbabwe Independent reported on July 13.

Delta is 40% owned by Anheuser-Busch InBev, the world’s largest beer maker based in Leuven, Belgium.

Zimbabwe is currently facing crippling shortages of hard currency that has seen banks defer foreign payments by as much as six months. Ordinarily, the repatriation of foreign exchange for securities related transactions is given top preference on the central bank’s list for the allocation of foreign currency.

“The situation has not improved at all, we have over US$70 million due to foreign shareholders. We are focusing on funding imported raw materials,” Delta company secretary Alex Makamure told businessdigest this week. Delta has since declared another interim dividend of US0,02 cents per share, amounting to US$25,2 million.

As of February, the country had a backlog of US$164 million for transactions conducted on the Zimbabwe Stock Exchange (ZSE). The Reserve Bank of Zimbabwe last year said it would establish a US$5 million revolving fund to facilitate the efficient repatriation of portfolio-related funds to foreign investors but the facility is still not yet to be operational.

In a quarterly update on July 11, Delta said the business recorded positive volume growth with all beverage categories recording an increase in revenue which positively impacted on profitability and cash flows.

Group revenue increased by 40% for the quarter reflecting the changes in category mix.

“Lager beer volume is up 56 % over prior year for the quarter matching the historical peak run rates post dollarisation. Whilst product supply is largely stable imported inputs remain a constraint,” the company said.

“The sparkling beverages volume increased by 23 % over prior year for the quarter. The soft drinks category was adversely affected by challenges in securing imported raw materials leading to extended periods of production stoppages and out of stock situations.

“In Zimbabwe the sorghum beer volume declined by 5 % mainly due to shortages of packaging materials for Chibuku Super. Product supply had improved by the end of the quarter. The product mix has shifted to Chibuku Super which grew by 28 % to contribute 84 % of the volume.”

National Breweries-Zambia recorded volume growth of 21% on improved product supply and competitive pricing.

Delta, which is now an associate of Belgian brewer AB InBev after the latter’s acquisition of SABMiller in 2016, which held 40% in the local brewer, is still in negotiations to terminate a Bottlers Agreement with the Coca-Cola company.

The talks have progressed slower than expected.


09 July, 2018

   
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