Innscor Africa Limited, an expansive, cash rich manufacturing and retail conglomerate, is planning to invest US$70m in new projects in the next 18 months as part of efforts to enhance product quality, improve efficiency and improve production capacity.
Board chairman Addington Chinake said the planned projects will be in the milling, baking, protein, and packaging and beverage categories.
“The group has approved an investment pipeline of US$70m covering ongoing business optimisation initiatives, as well as the further expansion within existing business units. These exciting projects, will occur over the next 18 months,” Chinake said.
He added: “These are in various stages of implementation and will enhance product quality, improve efficiency and significantly increase production capacity. These projects span the milling, baking, protein, packaging and beverage categories whilst investment opportunities into new, adjacent categories and products will also continue to be assessed.”
In its financial results for the six months to December 31,2020, published last week, Innscor Africa’s revenue grew 45% to ZWL$27.7bn from ZWL$19.1bn reported in the prior comparative period, driven by strong volume performance across most units, the removal of subsidised pricing on certain core product categories and pricing policies that were implemented to secure inventory replacement.
Profit for the group dropped 11% to ZWL$2.394bn during the reviewed period from ZWL$2.708bn recorded in the prior comparative period owing to increased operating expenditure following escalations in certain cost buckets.
Cash generated from operations went up 774% to ZWL$7.2bn during the period under review from ZWL$825m reported in the prior comparative period.
Total assets stood at ZWL$39.7bn from ZWL$34.1bn. Net gearing for the group was negative at the end of the period under review.
The bakery division recorded a 26% increase in loaf volumes against the comparative figures. The division, Chinake said, continued to display good volume recovery which has resulted from both reliable and consistent flour supply and general price stability in its bill of raw materials.
National Foods’ volumes increased by 25% during the reviewed period while volumes in stockfeed division by 34%. The grocery division reported a 98% increase in volumes in the six months to December 31, 2020.
Profeeds registered an 18% increase while the Colcom division delivered a 31% growth in volumes.
Nampak and Probrands reported 26% and 43% volume increases respectively.