CFI Holdings Limited Reports a Sales Volume Increase of 16% for its Retail Division

Published On: March 18, 2024Company: CFI Holdings Limited (CFI.zw)
What strategic measures are CFI Holdings Limited implementing due to the projected weather and economic conditions?
CFI Holdings Limited is planning to implement strategic raw material procurement strategies to sustain operations, diversify its retail lines away from dependence on agro-inputs, and continue cost containment measures in response to the projected weather and economic conditions.

Summary of Key Points

  • The operating environment for CFI Holdings Limited has been challenging due to the depreciation of the Zimbabwe Dollar (ZWL) against the United States Dollar (USD) and inflationary pressures. This issue has been worsened by the late onset of the rainy season and prolonged dry spells, typical of the predicted El Nino phenomenon, which dampened many farming-related economic activities.
  • Despite the challenging conditions, sales volumes for Retail division increased by 16% to 21,453 tonnes because of improved fertilizer sales following a reduction in prices due to the resolution of global supply chain disruptions caused by the Russian-Ukrainian conflict.
  • Agrifoods’ sales volumes for the quarter at 9,832 tonnes were 18% higher than the previous year due to improved product availability stemming from strategic agreements with key raw material suppliers.
  • Victoria Foods’ wheat flour sales volumes only grew by 3%, which was linked to stable wheat supplies during the quarter. However, significant growth was limited by intermittent power outages. Maize meal volumes grew by 10% due to improved raw materials supplies.
  • The potato harvest for Glenara Estates doubled due to improved seed supplies, although the average selling prices dropped by 8% due to an oversupply on the market.
  • The Group’s inflation-adjusted revenues for the quarter were ZWL 159.8 billion, which were 544% higher than the comparative period in the previous year.
  • Weather experts predict lower than normal rainfall for the 2023/2024 agricultural season due to the El Nino phenomenon, which can reduce agricultural output in the region.
  • The Management team is tasked with implementing strategic raw material procurement strategies to sustain operations, diversifying retail lines away from dependence on agro-inputs.
  • Group anticipates the FY2024 economic situation to remain challenging, and ongoing cost containment measures will continue to be implemented.

Useful links

About CFI Holdings Limited (CFI.zw)

CFI Holdings Limited is a diversified Zimbabwean agro-based conglomerate with retail, farming, milling, and property development operations. The Group’s retail arm, Farm & City Centre, supplies agricultural inputs and hardware products, while its farming division, Glenara Estates, produces maize, soya beans, and potatoes. CFI’s milling operations include Agrifoods and Victoria Foods and the manufacture of stock feeds, flour, and other food products. The company also manages a substantial property portfolio. Despite navigating a challenging economic environment characterized by high inflation and foreign exchange volatility, CFI remains committed to investing in its operations, engaging stakeholders, and contributing to food security in Zimbabwe. As of September 2023, the Group employed 1,774 people across its various business units.

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