Delta stumbles as beverage sales volumes fall

ZIMBABWE'S largest beverage manufacturer, Delta Corporation is planning to reduce employee numbers to address falling sales of lager and sparkling drinks.

In an internal memo to Human Resources managers leaked to the press this morning, the group calls on managers to undertake measures which will streamline operations in line with the performance.

"We need to immediately respond by rationalising our operations and reducing headcount," Marshall Pemhiwa, the company's director of human resources, said in a memorandum to heads of department, confirmed by the company. Other cost-saving measures include a recruitment freeze and cuts to training and canteen spending, according to the note.

Delta said in a separate trading statement that lager sales declined 8% in the three months through June, even as the Harare-based company reduced prices. Sparkling drinks were down 15%, while sorghum beer fell 12%. Maheu and dairy mix beverages recorded a decline of 11% for the quarter due, partly, to some production related supply outages.

"The installation of the new Chibuku Super production facility at Fairbridge in Bulawayo is expected to ease product availability."

"The downturn reflects weak underlying demand and the consumer preference for lower priced alternative offerings," Delta said.

"This reflects the depressed consumer spend, driven largely by the underlying weak macro-economic fundamentals."