Declining meat prices downplay Colcom subsidiary’s sales increase
HARARE – Colcom Holdings says it has, since dollarization, invested over $2.5 mln into subsidiary, Associated Meat Packers (AMP), in order to expand its retail arm;Texas Meats and Chicken outlets which now contributes 21% to gross turnover.
In an interview, group chief executive officer Dino Tumazos said there are now 15 Texas Meats shops and five Texas Chicken shops which are situated in seven towns: Harare, Chinhoyi, Bindura, Gweru, Ruwa, Rusape and Mutare.
An additional branch is also at the AMP factory shop situated in Workington, Harare.
“The AMP factory itself was expanded in 2015 to service the expanding Texas Meats shop network. The new facilities and equipment that were installed significantly enhanced factory flows and doubled its capacity,” Tumazos said.
He added that the contribution of Texas shops to the Colcom Holdings group is currently 21% of gross turnover.
Group revenue for the year ended 31 December 2016 increased 8% to $33.07 mln compared to $30.57 mln in 2015 largely on increased volumes which went up 23% on prior year due to increased investments in own pig production facilities and pig slaughter numbers.
In the period under review AMP’s sales volumes increased 9% but the increase did not reflect in the revenue growth due to continued reduction in the selling price of meat products year on year.
On the pie factory which was commissioned in August 2015, Tumazos said the automated pie factory is operating at approximately 85% of its installed capacity, working on a two-shift system.
He however said as with any manufacturing operation, operational challenges have on occasion been experienced in this new factory and the company continues to resolve these as they are identified.
In terms of raw materials, Tumazos said maize and soya are the most essential ingredients in pig stock feeds and require continuous re-supply.
He said the Group’s pig production unit, Triple C Pigs, has in the past few years been importing the bulk of its requirements but expects that it will soon be able to obtain maize locally from this season’s expected greatly improved harvest.
“The group has a significant requirement for imported raw materials, spares and capital equipment to manufacture product through Colcom’s processing facility. The limited availability of foreign currency to pay for these critical inputs is a well-known issue and we continue to work with the authorised dealers to secure foreign payments,” he said.