In the same period last year, volumes grew by 15%. There was increased demand for the products despite the unusually cold weather. Mutizwa explained that Schweppes volumes, in which Delta holds a 49% stake, were up 18% ahead of prior year.
“Volume ramp up has begun to accelerate and this will lead to the delivery of strong profitability,” he said adding that Schweppes could have done better had it not been for juice shortages that affected the company.
The high demand means that sales were up with lager beer sales up 28%. Delta had budgeted an increase of 16%. Sorghum beer sales were up 17% from the planned 11%.
“This is nothing short of a turnaround. The soft drinks performed at 45% but could have been at anything between 50% and 55% but this was constrained by capacity challenges,” he said.
Mutizwa told shareholders the company had a borrowing capacity of US$250 million, with US$21 million having been borrowed as at the end of June this year.“We would like to borrow more to get more geared and improve our earnings.
“We need to borrow long term at lower rates, and we are presently discussing this,” he said, adding that this would be necessary to optimise funding for both capital expenditure projects and working capital requirements.
Delta Corporation chairman, Canaan Du-be told shareholders that the “modest” price increases had been effected to mitigate the cost escalations induced by the South African rand and euro strength against the United Sta-tes dollar.
“The year under review has been one of change for the country and group. Adoption of multiple currencies has allowed companies to trade normally and make decisions based on normal business risks and expectations,” Dube said.
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“We continued to strategically invest in the business and it is pleasing to see the new capital expenditure contributing to improved throughput supporting the growth in volumes and delivering better efficiencies,” he said.
Dube said the corporation had already invested in a new 42 000 bottles per hour lager beer packaging line at Belmont, Bulawayo.
Delta also intends to localise the production of the Castle Lite brand by year-end.
