IN July, Zimbabwe’s biggest beverages producer, Delta Corporation appointed Matlhogonolo Valela (MV) has chief executive officer (CEO), taking over from Pearson Gowero.
Our business reporter, Freeman Makopa (FM) talked to Valela about this tenure so far. Below are excerpts from their discussion…
FM: You were recently appointed Delta CEO. Tell us about your experience so far?
MV: Delta is a great business with great people.
I only have the honour and privilege to play the role of leader to Team Delta.
You have seen the half year results; they are a reflection of the tremendous work the team is executing every day to serve customers and deliver our finest beverages to our consumers.
I am privileged to have been an insider with intimate knowledge of the business as I have been part of the leadership team for many years.
Our vision is to be the most admired beverage company in the region.
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So far, our footprint is in Zimbabwe, Zambia and South Africa.
We aim to grow the various businesses’ profitability and sustainably for the benefit of our employees, communities and all the stakeholders.
FM: Tell us about the performance of your operations in the three countries this year?
MV: In most of our businesses in Zimbabwe, we are operating at optimum capacity and where necessary we are triggering the investments to address capacity gaps and ensure adequate product supply.
In the other two territories, we have sufficient capacity for now although there is always need for productivity improvement capital expenditure.
United National Breweries is fully operational post partial and full closures in line with the alcohol bans and lockdown restrictions at both supply and consumption level in South Africa.
Some reasonable volume recovery has been recorded month on month as they climb out of the lockdowns.
Delta looks forward with excitement on the opportunities this business could offer going forward.
How Covid-19 will affect lives and livelihoods remains unknown.
Our focus is on mitigating its adverse effects and ensuring employee and stakeholder safety.
FM: Tell us about consumption patterns of alcohol during election periods? Does the 2023 elections present opportunities for Delta?
MV: Elections are always an opportunity for citizens to exercise their constitutional rights to choose their representatives at national and local levels.
The election season offers consumption opportunities during and after the plebiscite.
Delta looks forward to capturing the consumption occasions and opportunities during elections as these create selling opportunities for our very rich beverages portfolio.
FM: You have disagreed with your auditors over the interpretation of the exchange rate. Please shed light on this.
MV: Delta recognises the foreign currency auction system and the benefits it brought to the market.
The differences in opinion with the auditors relates to International Financial Reporting Standards compliance on the financial statements on commercial transactions as recorded in a multiple currency environment.
Our particular circumstance is that we have not accessed the auction market in the reporting period as the company is generating foreign currency from trading.
FM: How has your investments in other economies assisted you in terms of raising foreign currency?
MV: Investments in other jurisdictions is a long-term strategy that does not give immediate returns as one has to deploy capital before you can realise returns.
So there are as yet no significant forex inflows from our foreign operations as we are still executing on our strategies and learning how to operate across those geographies.
The company is trading some of its beverages in multiple currencies.
This has been the source of forex that it uses to fund its imported inputs requirements.
The multiple exchange rates that exist in the market distorts input costs depending on one’s source of forex.
Delta has not been accessing the auction for most of its requirements as it uses its takings to cover for its imports and foreign currency obligations.