Delta Corp Ltd., the Zimbabwean brewer that’s the nation’s biggest company by market value, said lager volumes decreased 26 percent in the fourth quarter on high excise duties and a collapse in disposable incomes.
Total beverage volume declined 6 percent in the three months through March, the Harare-based company said in a statement on its website. Volumes of sorghum-based beer gained 10 percent as drinkers turned to cheaper alcoholic alternatives to quench their thirst.
“The slowdown in consumer spending and economic activity reported in the last update persisted into the fourth quarter which was characterized by rapidly declining consumer disposable incomes,” Delta said. Lower lager sales “reflects both softening demand and the impact of high consumer prices driven by the high levels of excise duties.”
Zimbabwe’s economy is suffering from a slump in consumer spending and will probably be beset by deflation in coming months, the country’s Finance Ministry said in its February Treasury State of The Economy Report. Sales of consumer goods fell by as much as 30 percent that month, it said. The government of President Robert Mugabe is trying to revive an economy that was 49 percent smaller last year than it was in 2000, according to ZimTrade, a government agency.
Delta’s total revenue fell nine percent in the quarter and one percent for the full year, it said. The company, 21 percent-owned by SABMiller Plc, the world’s second-biggest brewer, will release its full annual results May 15.