Delta Predicts Tough Q4 in Regional Markets

Zimbabwe’s largest alcoholic beverage maker, Delta Corporation Limited (Delta) anticipates a subdued business outturn from its regional markets during the fourth quarter (Q4) due to tighter lockdown restrictions imposed by the government at the beginning of the year amid worsening COVID-19 infection figures.

The Group, which has units in South Africa and Zambia posted notable declines in volumes during the third quarter due to the impact of COVID-19 and the trend is expected to continue following stricter measures on movements following the discovery of a new COVID-19 variant.

“The authorities in regional markets invoked heightened levels of lockdowns in January 2021 in response to the upsurge in COVID-19 infections and emergence of more virulent strains,”

“The business outturn for the fourth quarter will therefore be subdued although the Zimbabwean economy could benefit from improved access to foreign currency and lower inflation,” said Delta in its latest trading update for the third quarter.

A new virus strain was discovered and traced to South Africa last month prompting authorities to scale up restrictions such as lengthening curfew hours and restricting trading hours for liquor sales and other gatherings- all which have a direct impact on the company businesses.

In the quarter ending December 31, 2020, the Group subsidiary, Natbrew Zambia reported a 2 percent decline in volumes for the quarter.

The South African entity, United National Breweries recorded a year on year decline of 19 percent for the quarter as South Africa implemented very strict restrictions and bans on the sale and consumption of alcohol.

The total ban on alcohol sales was re-imposed at the end of December 2020.

In Zimbabwe, alcohol sale remains unrestricted despite a stricter lockdown imposed on January 5, 2020 and is likely to buffer the Group business operations.

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