Zanu-PF politicians unhappy with Delta Corporation

ZANU-PF politicians in Marondera are unhappy with the decision by Delta Corporation to stop production at the Marondera plant alleging it's a ploy to sabotage the region by the company.

Delta stopped production at the Marondera plant and is planning to do the same in Karoi and Hwange. Makamure confirmed saying: "We have temporarily stopped production at Marondera. The next category will be Karoi and Hwange for the meantime."

He said the company is scaling down production at certain sites that can be fed economically from other sites. Makamure said the rationalisation will not result in any losses of permanent jobs as those affected will be absorbed in the distribution and freight departments and other group operations.

"Some losses of temporary employment and economic activity in specific geographical areas will unfortunately arise from such business rationalisation," he said.

Speaking about the closure of their Marondera plant for Chibuku which will now be serviced from Chitungwiza, Makamure said: "The pace of this rationalisation will depend on the success of the Chibuku Super product and its impact on the existing Chibuku business. This is likely to take a number of years.  We are currently reviewing the interplay in the Harare, Marondera and Rusape markets."

He said the sorghum beer business was undergoing significant product and technological changes which cannot be avoided.

"In view of these developments, it is not sustainable for the business to run 15 breweries and therefore the closure of certain facilities will arise. In each affected case, we interact and communicate with our various stakeholders prior to taking the decision. In the case of Marondera, we will continue to use the facility as a distribution hub. It is pertinent to note that a greater number of our sorghum beer employees work in the sales and distribution functions. No losses of permanent jobs are envisaged at this stage," he said.

Delta last year launched Chibuku Super. This product has a shelf life of more than 21 days compared to four days for the standard Chibuku.

According to Delta, Chibuku Super is currently being produced at Chitungwiza brewery and is distributed nationally. The Chibuku Super investments have released additional capacity for the production of the standard Chibuku, particularly at the Harare brewery and will also result in significant changes to the distribution platform.

The national establishment of 15 sorghum beer breweries was also part of the distribution network due to the limited shelf life of the product.

In an trading update issue on Friday, Delta's revenue was down three percent for the nine months to December 31, 2013. Total beverage volume during the same period was flat against the same period last year.

The decline in lager volume continued, registering a 25 percent drop versus prior year for the quarter and 15 percent for the nine months. Sparkling beverages were also down six percent for the quarter and two percent for the nine months. Sorghum beer continues to record significant growth, up 18 percent for the quarter and 12 percent for the nine months indicating consumer acceptance for the category driven by success of Chibuku Super.

Maheu was up 23 percent for the quarter and 42 percent for the nine months.