LISTED diversified concern CFI Holdings is doubling down on strategic investments in its core business units and intensifying cost optimisation efforts over the short-to-medium-term to drive sustainable growth.
This dual focus will lay groundwork for long-term success and resilience, according to CFI chairperson Itai Valerie Pasi.
The company has retail, farming, milling and property development operations.
In a statement accompanying the group’s financial results for the half year ended March 31, 2024, Pasi said the company aimed to improve business models to be adaptive to the changing environment.
“Going forward, in the short-to-medium-term, the group will prioritise continued investments in its business entities and upscaling ongoing cost containment measures, in order to underpin long-term competitiveness,” she said.
“Long-term focus remains directed towards the development of low-cost housing delivery in Harare South in support of government’s Vision 2030 development goals.
“The group will, therefore, maintain its efforts to resolve issues affecting its interests in its land banks to make way for progressive, orderly infrastructure deployment and service delivery to the various settlements.”
Group inflation-adjusted revenues for the half year increased by 44,3% to ZWL$1,51 trillion compared to the prior period.
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This improvement reflected on management’s ongoing efforts to grow the group’s business in a difficult operating environment.
Retail operations contributed 80,42%, milling operations contributed 16,41%, and farming operations accounted for 3,17% of group turnover.
The group posted a profit before tax of ZWL$470,77 billion against a loss before tax of ZWL$280,26 billion from prior year.
The Farm & City Centre division felt the impact of a combination of falling consumer demand for agricultural inputs in the face of the El Niño-induced drought, rapid inflation and overall suppressed consumer spending power.
“The retail market also witnessed stiffening competition, mainly from the unregistered informal players, resulting in shrinking margins,” she said.
“Notwithstanding, sales volumes for the entity’s key volume drivers registered a marginal 2% increase over the comparative year period prior. Management continues to implement strategic pricing and marketing initiatives to adapt to the ever-changing trading environment.”
During the period under review, Glenara Estates established 82 hectares of table potatoes, up from 54 hectares in the prior period last year.
Although yields were 5% lower than year prior, average potato selling prices realised per kilogramme firmed by 17% above prior year, as a result of shortages of the crop on the market, due to the drought currently being experienced in the country.
The estate’s cattle breeding and pen fattening operations were maintained with reasonable success, Pasi said.
Agrifoods sales volumes increased by 8% from prior year on the back of improved raw material procurement management across major product lines.
“Management remains focused on growing Agrifoods’ market share in the face of an increasingly competitive local stockfeeds sector,” Pasi said.
Flour sales volumes performance at Victoria Foods was flat from the same period prior year as the unit grappled with wheat shortages and continued power outages affecting production.
However, maize volumes sales improved by 55% due to successful marketing efforts.
The maize milling business is, however, set to be impacted by the maize shortages following the regional El Niño-induced drought, resulting in increased grain prices, Pasi said.
“These higher prices will result in a higher cost base that may not be fully transferred to customers due to a highly competitive market, amid depressed consumer spending power,” she said.
Crest Poultry Group remained under care and maintenance during the period.
Pasi said joint ventures leveraging the group’s poultry infrastructure and brands were still being pursued.
Processes are also underway to resuscitate poultry operations on the group’s Beatrice farm, Hubbard Zimbabwe, she said.
