CHAIRMAN’S STATEMENT
OPERATING ENVIRONMENT
The operating environment during the review period was characterized by relative stability, primarily underpinned by the resilience of the Zimbabwe Gold (ZWG) against the United States Dollar (US$). This stability was further supported by improved foreign currency availability, particularly through the Reserve Bank of Zimbabwe’s Willing-Buyer-Willing-Seller market, which facilitated the importation of critical raw materials. A favourable 2024/2025 agricultural season enhanced food security and foreign currency inflows, further reinforcing market stability. Nonetheless, constrained liquidity persisted in both ZWG and US$ terms.
A notable development was the enactment of Statutory Instrument 34 of 2025, which removed penalties for businesses pricing above official exchange rates. This reform enabled greater pricing flexibility, improved alignment with market realities, and strengthened profitability prospects. The retail sector benefitted significantly, improving supply chain stability.
While water and electricity supply remained erratic, the situation showed slight improvement compared to the prior year.
PERFORMANCE
Raw Milk
National raw milk production increased by 3.9% year-on-year, rising from 55.1 million litres to 57.3 million litres (Ministry of Lands, Agriculture, Water and Rural Development, Dairy Services Unit).
Dairibord’s milk intake expanded by 3.7%, from 19.6 million to 20.3 million litres, accounting for 38% of national production. The Milk Supply Development Unit continues to recruit new producers, including small- and medium-scale farmers, to meet growing demand.
Sales Volume and Revenue
The Group achieved an 18% growth in overall sales volume. Performance by category was as follows:
- • Foods: +18%, driven by strong yoghurt and tomato sauce sales.
- • Beverages: +28%, with exceptional performance from Pfuko and Cascade, alongside a recovery in Tea due to improved availability.
- • Liquid Milks: +1%, reflecting modest growth.
Export volumes decreased slightly from 9% to 8% of total volume. Group revenue, nonetheless, increased by 18% to ZWG1.82 billion, largely on the back of volume growth.
Comparability of Financial Performance with Prior Period
The Group changed its functional and presentation currency to US$ effective 1 March 2024. As such, comparative figures for January – February 2024 were translated from the Zimbabwe Dollar (ZWL) to US$, introducing distortions due to exchange rate volatility and inflation index estimation. Accordingly, caution is advised when comparing 2025 results with prior period numbers, particularly in cost of sales, operating expenses, other income/expenses, and finance costs.
Profitability
- • Gross Profit: ZWG446.4 million, marginally higher than prior year.
- • Operating Profit: ZWG78.08 million, down 28%, reflecting the absence of prior year monetary gains.
- • Profit Before Tax: ZWG58.81 million, up 51%, buoyed by significantly lower finance costs as exchange losses on foreign loans declined.
Sustainability
The Chipinge solar plant initiative remains central to improving energy reliability and reducing the Group’s carbon footprint.
This project is expected to yield significant operational and environmental benefits.
Community and nutrition programs continue to underpin the Group’s social impact. Key highlights include:
- • Partnerships with orphanages, elderly care homes, hospitals, and schools to promote nutrition, hygiene, and dairy product consumption.
- • Donation of battery-powered tricycles to communities in Manicaland, supporting both healthcare access and raw milk transportation from smallholder farmers to collection centres.
WORKING CAPITAL
Despite seasonal cash flow challenges during the winter period, the Group achieved a substantial improvement in operating cash flows, reducing the deficit from ZWG65.56 million in the prior period to just ZWG1.08 million.
Enhanced credit risk management and improved inventory turnover practices are expected to further strengthen cash flow generation in the second half.
Group revenue increased by 18% to ZWG1.82 billion, largely on the back of volume growth.
OUTLOOK
Although the first half reflected relative stability, the business continues to operate in a volatile and unpredictable environment. The Group is therefore:
- • Intensifying risk management and hedging strategies to mitigate exposures.
- • Sustaining its focus on cost containment and efficiency.
- • Pursuing aggressive investment in replacement and refurbishment of critical equipment, aimed at boosting production capacity and positioning the Group for volume growth into 2026 and beyond.
DIVIDEND
In order to preserve cashflows for strategic capital expenditure, the Board has resolved not to declare a dividend for the six months ended 30 June 2025.
APPRECIATION
On behalf of the Board, I extend sincere appreciation to our management, staff, and stakeholders for their commitment and resilience. As the incoming Chairman, I am honored to build on the strong foundation laid and to lead the Group in unlocking new opportunities for sustainable growth and long-term success.
N.H.C. Chiromo
Chairman
11 September 2025