Zambeef Products PLC, a leading cold chain food and retail business in Zambia, Nigeria, and Ghana, has provided a trading update for the year ended 30 September 2024. The company expects revenue and gross profit to be approximately 15% below market expectations due to operational performance and currency depreciation. Profit before tax is anticipated to be around 30% lower, primarily due to higher financing costs and an impairment of an investment in an associate. The reported profit after tax is expected to be approximately 55% below current market expectations, reflecting a loss from an asset held for sale.
The company faced a challenging market and operating environment in the first half of 2024, with constrained consumer spending, tight monetary policy, and constrained government spending in Zambia. The macroeconomic instability, stemming from delays in the country's debt restructuring process, further impacted the operating environment. Additionally, adverse effects of El Nino, including the worst drought in the region's history, led to reduced crop yields and diminished water levels, affecting hydro power generation and increasing overhead costs.
Zambeef's strategic initiatives, including optimized pricing, helped mitigate the impact of rising input and overhead costs. However, the company expects to take a 50% impairment on its investment in Zampalm in the interim results to 31 March 2024, with a full impairment expected in the full-year results to 30 September 2024.
The company's half-year results for the period ended 31 March 2024 are expected to be released by the end of June 2024. Shareholders are advised that the information in this trading update has not been reviewed or reported on by the company's external auditors.
Zambeef Products PLC is the largest integrated cold chain food products and agribusiness company in Zambia, with operations in Nigeria and Ghana. The company is involved in primary production, processing, distribution, and retailing of various food products. It operates 236 retail outlets throughout Zambia and West Africa and is one of the largest suppliers of beef, chicken, pork, milk, dairy products, fish, flour, and stockfeed in the region.
For further information, visit www.zambeefplc.com or contact the company directly.