WINES, spirits and ciders maker, African Distillers Limited (AfDIS) has bemoaned the influx of cheaper imports which have seen sales volumes plummet to 1%.
The revelations come at a time when numerous bottle stores have flooded cities across the country with many selling such alcoholic beverages at very cheaper prices, in the process outcompeting locally manufactured beverages.
Experts have warned that if such imports go unchecked they risk weighing down the fiscus earnings as well as triggering job cuts.
Presenting the company's performance for the period ended March 31 2024; AfDIS chairman Matts Valela bemoaned the impact of the cheaper imports on the company's sales volumes.
"The period saw a continued increase in illicit products alongside a rise in irregular imports from neighbouring countries, which are usually not compliant with regulations. These developments increased competition that disadvantaged local industries.
"The Company recorded a marginal growth of 1% over last year as consumer demand was weighed down by an influx of cheaper imports and illicit products on the market. The Ready to Drink ("RTD") segment grew by 5% benefiting from improved product availability on ciders and consumer activations.
"The Spirit category decreased by 2% due to increased competition from cheap and illicit spirits. Wine performance remained at par with the prior year," he said.
Meanwhile, during the period, revenue increased by 26% to US$51,8 million whilst operating income increased by 23% to US$6,6 million.
Volume growth of 1% partly contributed to this revenue growth. The differences in approaches used in deriving US$ numbers highlighted above together with the distortions in exchange rates and inflation indices make comparison to the prior year difficult.
Going forward, the company's economy is projected to continue growing anchoring on infrastructural development, tourism, mining activities and increased diaspora remittances.
This growth will however be slowed down by the El-Nino-induced drought being experienced in the country and the continued fall of global metal prices.
"The Company is hopeful that the newly introduced currency, Zimbabwe Gold ("ZiG") will help restore stability in exchange rates and tame inflation," added Valela.
