Zambeef Products, one of the largest chicken and egg producers in Zambia, has warned that its revenues for the year ended September 30 will be slightly lower than market expectations.
The company’s chicken and egg division processes 5.3 million chickens annually and produces 33.5 million eggs, accounting for 9 percent of total revenues and 8 percent of profits. However, like its beef division, the sector has experienced difficulties in 2014.
For the six months ended March 31, the company reported that sales in the division were 12 percent lower, standing at US$4 million. It noted both a reduction in stock levels and margins. Nevertheless, it entered into a joint venture with Rainbow Chicken which saw an expansion of value added products and in individually quick frozen portions. The company also noted that egg production would rise in the second half.
During the second half of Zambeef’s financial year, the company benefited from the exchange rate returning to relative stability, resulting in reduced foreign exchange losses compared with the first six months. Additionally, livestock movement restrictions introduced by the Zambian government due to African swine fever were lifted. The company also notes that good harvests are expected this year meaning that its cropping division is likely to perform above expectations for the year as a whole.
Final results are expected to be published at the end of November.