Zambeef posts reduced profits

Zambeef cows
ZAMBEEF Group’s revenue rose by 24 per cent to K1.595 billion while gross profit went up by a similar percentage to K553 million for the year ended September 30 2013.

The company is poised for growth as it continues to invest across its divisions in Africa.

Zambeef chief executive officer Francis Grogan said the group’s profit reduced by about K23.4 million.

Speaking during the presentation of the company’s annual result for the year ended September 30, 2013, Mr Grogan said the performance of perishable products was affected in the fourth quarter of this year as a result of the publicity received on imported products.

Edible oils accounted for the strongest gross profit growth across the company’s divisions, more than doubling during the year to K49.776 million.

Cropping also saw strong growth, with a 49 per cent increase in gross profit to K154 million during the year, while the group’s Novatek stockfeed business was up by 21 per cent to K48.85 million.

The company also continued its programme of upgrading its retail outlets, with 20 being refurbished during the financial year.

Other highlights include the resumption of crushing at Zamanita’s refurbished edible oils plant increasing its annual capacity of 100,000 tonnes.

Crop yields continued to improve across Zambeef’s farms, led by Mpongwe farm.

Mr Grogan said the selling price of wheat decreased by about K479 per tonne consequently reducing the group’s profit by about K21.5 million.

He said 2013 was a challenging year for Zambeef as it sought to respond to some of the concerns with regard to perishable products.

But the company was set to increase its investments across a number of its divisions as it forges ahead with its goal of becoming one of the leading food producers in the region.

“The board is committed to unlocking value for its shareholders wherever it can. The deal announced earlier in the year to enter into partnership with Rainbow involved a disposal to Rainbow of 49 per cent equity interest in Zamchick.

“The consideration paid by Rainbow include a profit of K69 million, a clear demonstration of the value that has been created in Zamchick,” Mr Grogan said.

Zambeef group chairperson Jacob Mwanza said it was heartening to see revenues continue to increase at the same time as the directors prepare the business for future growth across a number the divisions.

Dr Mwanza said the key financial highlight had been to return the business to positive generations, which was in line with the strategy set out when Zambeef was listed on the London Stock Exchange in June 2011.

 times of zambia