No festive cheer for Delta as lager sales dip 14%

Delta Corporation saw its lager volumes dipping by 14% in the third quarter ending December 31, 2015, from the prior quarter, as consumers shifted to cheaper alternatives, the beverages maker has said.

BY BUSINESS REPORTER

The quarter under review has the festive season, where consumers traditionally increase spending habits.

In a trading update yesterday, Delta said volumes and revenue were subdued attributing this to depressed aggregate demand.

“Lager beer volume declined by 14% compared to the prior year for the quarter, reversing the nascent recovery in the previous quarter. The volume is down 6% for the nine months to December 2015. The consumers continue to shift to cheaper alcohol categories,” Delta said.

Sparkling beverages volume was flat on prior year for the quarter and down 9% for the nine months, the company said.

Delta Beverages lagers

It said there were some increases in demand driven by the high temperatures experienced in the period.

The alternative beverages (maheu and dairy mix beverages) recorded a decline of 7% for the quarter compared to prior year, attributed to a supply challenge in November.

The alternative beverages category is 5% below prior year for the nine months, Delta said.

The sorghum beer volume was flat on prior year for the quarter and down 8% for the nine months.

“The category continues to benefit from consumers drifting from other alcohol alternatives and the increased output of Chibuku Super, which remains in short supply,” Delta said.

Group revenue was down 5% for the quarter and is down 7% for the nine months, reflecting changes in the portfolio mix and price moderations during the year.

“The company will continue to implement strategies to retain consumers within its portfolio,” Delta said.

The AB InBev unit has been reducing the prices of its products to stimulate demand in the wake of waning disposable income.

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