2nd Dec 2020 12:09
(Alliance News) - Zambeef Products PLC on Wednesday said it swung to an annual loss, and it expects the macro-economic climate to remain challenging in the year ahead.
Shares in the beef producer were flat at 5.05 pence each midday Wednesday in London.
For its financial year ended September 30, Zambeef posted a pretax loss of ZMW22.7 million - around USD1.1 million or GBP816,000 - a swing from a profit of ZMW38.7 million recorded the year prior. Revenue was up 24% to ZMW3.88 billion from ZMW3.13 billion. However, administrative expenses rose 9.2% to ZMW1.01 billion and finance costs were 12% up at ZMW92.3 million.
The Lusaka, Zambia-based said its poor performance was due to a difficult operating and economic environment amid the Covid-19 pandemic, with the Zambian Kwacha weakening by 54% against the dollar, resulting in high inflation and reduced customer spending.
While revenue in Kwacha terms showed growth of 24%, due to depreciation of the currency, revenue in dollars shrank 5.9%.
Looking ahead, Chair Michael Mundashi said: "We expect the macro-economic climate to remain challenging in the 2021 financial year, characterised by an increase in volatility. The country's national debt level remains a threat to macro-economic stability in the short to medium term. We anticipate the Covid-19 pandemic will have minimal impact on our operations in 2021 as Zambia will adjust to living with the virus and resume life under the new normal. However, we expect the volatility in the economy to continue impacting the spending power of our customers."
By Ife Taiwo; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
Zambeef Prod.