REG - Zambeef Products PLC - Trading Statement

Zambeef ProductsAnnouncement

28/11/2024 15:15

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RNS Number : 0775O  Zambeef Products PLC  28 November 2024

 

 

ZAMBEEF PRODUCTS PLC

[Incorporated in the Republic of Zambia] Company registration number: 31824
Share Code: ZAMBEEF

ISIN: ZM0000000201

 

 

In accordance with the Lusaka Securities Exchange ("LuSE") Listings
Requirements, the Board of Directors of Zambeef Products Plc (the "Company" or
the "Group") hereby advises the shareholders of the Company that the Total
Basic Earnings per Share for the financial year ended 30 September 2024 is
expected to be 48.7% higher (in Zambian Kwacha) than that of the financial
year ended 30 September 2023.

 

During the year ended 30 September 2024, the Group posted profitability growth
(in Zambian Kwacha) despite a challenging economic and operating environment,
due to underlying operational performance.

 

The Company reiterates the guidance provided in the Company's previous Trading
Update of 22 November 2024, and therefore there is no change to the most
recent market expectations as updated on 22 November 2024.

 

The macroeconomic conditions leading up to September 2024 were characterized
by difficult operating circumstances, including, as previously announced, a
severe drought and reduced consumer spending, compounded by the Central Bank's
tightening monetary policy to address inflationary risks and constrained
government spending. These factors significantly limited kwacha liquidity in
the economy, leading to lower-than-expected demand for our products. The
outbreak of Anthrax restricted cattle movement and negatively impacted public
perception, slowing beef volumes in the first quarter. However, we saw a
recovery in beef volumes, as bans on animal movement were lifted, from the
second to the fourth quarter due to improved availability.

 

Furthermore, diminished water levels impacted Zambia's hydropower generation
which accounts for 85% of the country's electricity. The government initiated
an aggressive countrywide load management program that necessitated the use of
more expensive alternative energy sources.

 

This, along with the sustained devaluation of the local currency from
K21.02/USD at the beginning of the financial year to K26.54/USD at the end of
the period along with an average inflation rate rising to 15.6%, contributed
significantly to the high input and overhead costs.

 

Despite these challenges, the business remained focused on its primary
strategy of revenue enhancement, cost optimization, and volume growth.

 

The Group expects its results for year ended 30 September 2024 to be released
in early December 2024. Shareholders are advised that the information
contained in this Trading Statement has not been reviewed nor reported on by
the Company's external auditors.

 

 

For further information, please visit www.zambeefplc.com
(http://www.zambeefplc.com/) or contact:

 

 Zambeef Products plc                                          Tel: +260 (0) 211 369003
 Faith Mukutu, Chief Executive Officer
 Patrick Kalifungwa, Chief Financial Officer
 Cavendish Capital Markets Ltd (Nominated Adviser and Broker)  Tel: +44 (0) 20 7220 0500
 Ed Frisby/Abigail Kelly (Corporate Finance)
 Tim Redfern (ECM)
 Autus Securities Limited (Sponsoring Broker)                  Tel: +260 (0) 761 002 002
 Mataka Nkhoma (Sponsoring Broker)

Notes to Editors

 

Zambeef Products plc is the largest integrated cold chain food products and
agribusiness company in Zambia and one of the largest in the region, involved
in the primary production, processing, distribution and retailing of beef,
chicken, pork, milk, dairy products, fish, flour and stockfeed, throughout
Zambia and the surrounding region, as well as Nigeria and Ghana.

 

It has 250 retail outlets throughout Zambia and West Africa.

 

The Company is one of the largest suppliers of beef in Zambia. Five beef
abattoirs and three feedlots are located throughout Zambia, with a capacity to
slaughter 230,000 cattle a year. It is also one of the largest chicken
producers in Zambia, with a capacity of 9.4m broilers and 31.2 million-day-old
chicks a year. It is one of the largest piggeries, pig abattoirs and pork
processing plants in Zambia, with a capacity to slaughter 75,000 pigs a year,
while it's dairy has a capacity of 120,000 litres per day.

 

The Group is also one of the largest cereal row cropping operations in Zambia,
with approximately 7,787 hectares of row crops under irrigation, which are
planted twice a year, and a further 8,694 hectares of rainfed/dry-land crops
available for planting each year.

 

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