Dairibord Zimbabwe Holdings (DZHL) will spend $10 million on capital expenditure this year to support growth for its products.
BY TARISAI MANDIZHA
Speaking at the company’s analyst briefing on Wednesday, group chief executive officer Antony Mandiwanza said the company has been recapitalising its business through own resources and borrowings.
“The $10 million capex is a combo of own resources and borrowings. We will inject a bit of borrowings,” he said.
Mandiwanza said the group would continue to rationalise and aim at increasing milk intake by 2% this year and grow volumes and revenue by 8% and 4% respectively.
During the year ended December 2014, DZHL raw milk intake declined by 2% due to a 20% decrease in Malawi as persistent quality challenges continued to negatively affect volumes for Dairibord Malawi.
Volumes for the group increased by 8% to 70,412 million litres while revenues declined by 1% to $99,016 million.
Mandiwanza said the mismatch between the price and volumes was an outcome of price adjustment to retain competitiveness.
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The group made a profit after tax of $730 456 compared to $1,8 million loss in 2013.
In 2014 the group invested $9,9 million in Pfuko/Udiwo maheu, ice-creams, Aqualite water, steri-milk and yoghurt equipment.
The group will spend $1 million to import 500 heifers by end of this year and the first batch of 100 heifers will be expected in the country by end of the month to boost milk production.
Dairibord’s plan for revival of dairy farming involves acquiring heifers and loaning them out to farmers. In return, farmers would provide milk to the company.
Mandiwanza said initially the company had plans to import the 250 heifers in 2014 but there were challenges that have now been rectified.
“We are expecting to import 100 heifers by end of March at a cost of $2 000 per each heifer. There will be continued support of the Heifer Importation Programme. The target for 2015 is 500 heifers, adding 200 000 litres per month,” Mandiwanza said.
Last year, the group promised to import 250 heifers but only managed to import 150.
“One hundred and eighty heifers were imported in 2014 bringing the cumulative total to 430. Heifer importation is contributing 5% of DZPL’s milk intake for the year,” he said.
Mandiwanza also said the group was set to commission the Chipinge Steri Plant next month.
“[The] Chipinge Steri Plant installation is in progress and we have finished installation and commissioning is expected end of April 2015,” he said.
