Delta Corporation Sees 25% Growth in First Quarter

Oscar J Jeke

Zim Now Reporter

Delta Corporation Limited has reported a 25% increase in group revenue for the first quarter ended 30 June 2025, driven by higher volumes and pricing adjustments across its key product categories, despite ongoing economic challenges and a volatile exchange rate environment.

In a trading update released this week, the beverage company cited strong consumer demand, improved supply chains, and the easing of power outages as key contributors to the growth. However, the company warned that exchange rate volatility, high taxation, and changes in market channels particularly the informal sector continue to weigh heavily on performance and margins.

“The Group is benefiting from a relatively stable operating environment… There are signs of strong consumer spending driven by a stable ZIG exchange rate, a record-breaking tobacco marketing season, and increased mining activity,” Delta said.

Lager beer volumes grew by 19% compared to the same period last year, boosted by improved raw material availability and reduced production disruptions. The company credited a stable supply of packaging materials and the continued popularity of key brands such as Castle Lite and Zambezi.

The sorghum beer category, however, was hit by a slow start to the agricultural season and soft demand in regional markets like Zambia. Still, Delta said there were promising signs heading into the winter season.

Sparkling beverages volumes rose 2% above prior year levels, showing resilience despite a muted economic environment. The division continues to battle pricing pressures from imported alternatives and an “unregulated use of artificial sweeteners” that Delta said threatens formal sector producers.

Nampak Zimbabwe, a recently consolidated subsidiary in which Delta now holds a 60% stake, experienced soft performance due to foreign currency shortages and production stoppages. The group noted that operations at South African partner United National Breweries also remained under strain, citing an “unfavorable economic environment” and delayed licensing reforms in the traditional beer category.

Delta expressed concern over its tax burden, revealing that the Zimbabwe Revenue Authority had issued a US$6.6 million back tax claim covering its Sparkling Beverages and Schweppes businesses. The group said it was engaging with ZIMRA while pursuing legal and fiscal reviews to resolve the matter.

The company also flagged the continued impact of “legacy” foreign currency liabilities that must be settled using official exchange rates, creating misalignments with accounting practices based on interbank market rates. “Management continues to engage with ZIMRA while appealing some legal and factual issues related to the assessments and the judgments,” read part of the update.

For the future, Delta said it expects a continuation of the relatively stable macroeconomic environment under the Zimbabwe Gold currency but cautioned that growth may be constrained by subdued consumer spending, taxation pressures, and policy inconsistencies.

“The Company remains focused on optimising its business models and managing costs while expanding availability and affordability of our products,” the update said.

The group reiterated its commitment to sustainability through its "Delta Beverages Pledge 1.5," which targets carbon emission reductions, increased use of renewable energy, and improved water efficiency. It also pledged ongoing investment in climate-smart technologies.

Delta Corporation, one of Zimbabwe’s largest listed firms, manufactures and distributes lager beer, traditional beer, soft drinks, and other non-alcoholic beverages through various joint ventures and subsidiaries, including Schweppes Zimbabwe and Nampak Zimbabwe.