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Mixed views on outlook for 2024

In the first quarter, companies noted that the authorities made several significant modifications to tax policy.

Publicly traded companies have expressed mixed views on the outlook for fiscal 2024, with some advocating consistent policies while others remain optimistic about the nation’s growth potential.

In the first quarter, companies noted that the authorities made several significant modifications to tax policy.

As a result, the value-added tax status of most commodities changed from exempt to exempt, affecting items such as livestock feed, flour, salt and corn flour.

A look at the recent business updates for the fourth quarter ended December 31, 2023 and the first quarter ended March 31, 2024 reveals that companies have different views on the current financial year.

Innscor Africa Limited said the outlook for the summer agricultural season was largely negative due to the devastating El Niño drought conditions currently prevailing.

Innscor stated that this would result in lower corn and soybean production across the region, leading to greater dependence on imports of these commodities.

“From a winter wheat perspective, drought conditions are also expected to negatively impact planting, which could have some effect on the mill value chain towards the latter part of the current calendar year,” Innscor said.

National Foods said changes made to the value-added tax status of many of its products during the quarter will make it increasingly difficult for the formal sector to compete against the informal sector and gray imports.

The firm urged the authorities to display some political coherence in the coming period. This would allow local formal sector players producing commodities to focus on consistently supplying consumers during what is expected to be a challenging period.

“The group’s objective will be to ensure adequate stocks of essential products at competitive prices for consumers across the country over the next 12 months,” he said.

“In the coming period, special attention will also be paid to ensuring that new categories that have been added to the group’s portfolio are successfully launched and achieve the targeted return on investment.”

African Sun emphasized that access to foreign exchange through formal channels remains critical, particularly given the suspension of the auction system following the introduction of the new currency.

However, looking ahead, the group expects to see continued improvements in its business, driven by the recovery of the international market, which has lagged since the end of the pandemic.

For Simbisa Brands, there is still significant growth potential in the home delivery segment. Growing and improving this revenue stream remains a key focus area, and significant progress has been made in the financial year so far.

The group said that despite the easing of currency pressures, it remains committed to maintaining strict cost controls to protect its margins. This approach ensures that your top-line growth initiatives translate into increased profitability.

“The short and medium term strategy will depend on increasing footfall to the existing store network through value offers and intensified promotion and marketing initiatives,” Simbisa said.

“The group is leveraging technology to drive the latter, using customer feedback platforms to continually improve our products and customer service.

“We will continue to increase our store presence, and the group intends to open a further 55 of its own stores, until December 31, 2024.”

ZB Financial Holding said that despite the anticipated challenges in the business environment in the short and medium term, it remained resilient and committed to providing value-added financial solutions to the nation at large.

This comes as the economy is negatively affected by an El Niño-induced drought, which will require the country to spend billions on food imports.

Another banking entity, FBC Holdings, said Zimbabwe made a compelling case for strong economic expansion and improved living standards, driven by a vibrant private sector.

“The country’s competitiveness in agricultural value chains remains strong, despite the drought caused by El Niño. Additionally, the potential for tourism and significant reserves of energy transition minerals, particularly lithium, are poised to positively impact economic activity,” he said.

NMBZ Holdings noted that the new monetary framework had remonetized the local currency and enhanced its functions as a medium of exchange and store of value.

The group added that it will continue to focus on its core business and expand its presence in all identified growth sectors of the economy.

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