HARARE — Dairibord Holdings delivered a strong first-half performance, with revenue rising 28% to US$82.56 million in the six months to June 30, 2026, as capacity expansion, resilient domestic demand and tighter cost management translated into substantial improvements in profitability.
The Zimbabwean dairy and beverages group reported a 26% increase in consolidated sales volumes to 78.3 million litres, from 62 million litres in the corresponding period last year, while raw milk utilisation remained broadly unchanged at 20.4 million litres.
The performance was led by the beverages division, which accounts for 67% of total group volumes. Beverage sales increased 33% year-on-year to 52.8 million litres from 39.6 million litres, with growth recorded across the portfolio.
Quench cordial was the standout performer, with volumes increasing 82%, while bottled Cascade volumes rose 68% following additional capacity unlocked at the Simon Mazorodze factory.
Fun n Fresh volumes increased 56%, while Pfuko Maheu grew 43%, supported by capacity expansion at Dairibord’s Chitungwiza plant.
The foods category also recorded strong growth, with volumes rising 30% to 7.3 million litres. Bulk ice cream increased 80%, salad cream 72%, Yogie drinking yoghurt 42% and Yummy Yoghurt 25%.
Liquid milk volumes grew at a more moderate pace, increasing 8% to 18.2 million litres. Management indicated that further expansion in the category was constrained primarily by raw milk availability rather than demand.
Steri Milk was among the fastest-growing products, with volumes increasing 72% following additional production capacity at the company’s newly commissioned Chipinge facility, which began operations in December.
Domestic market takes priority
Dairibord’s strong domestic performance came at the expense of exports, with export volumes declining 30% during the period as the company deliberately redirected production towards the local market.
The strategy reflects the strength of domestic demand, with management prioritising product availability in Zimbabwe across its major categories.
Revenue growth consequently outpaced the increase in operating costs. Cost of sales increased 25% to US$60.87 million, compared with revenue growth of 28%.
Gross profit rose 37% to US$21.69 million, from US$15.78 million, reflecting higher volumes and tighter management of raw-material and packaging costs.
Operating expenses also increased, although at different rates. Selling and distribution expenses rose 16% to US$10.14 million, while administration expenses increased 35% to US$6.03 million.
The combination produced a sharp improvement in operating profitability, with operating profit more than doubling to US$5.54 million, from US$2.76 million in the prior-year period.
Finance costs increased to US$1.15 million from US$720,000, reflecting borrowings undertaken to finance capital expenditure and working capital requirements.
Dairibord’s South African operation also expanded, with revenue increasing 38% to US$720,000, although the business remained a relatively small contributor to consolidated turnover.
Capacity investment becomes earnings driver
The results underline the growing importance of capacity investment to Dairibord’s recovery. Additional production capability at Simon Mazorodze, Chitungwiza and Chipinge enabled the company to respond to rising demand across several categories.
For investors, the combination of volume growth and improved capacity utilisation is significant because it allows Dairibord to spread fixed production costs over a larger output base while strengthening product availability.
The first-half numbers also suggest that the group’s principal constraint is increasingly shifting from market demand towards the availability of key agricultural inputs, particularly raw milk.
Chairman Nobert Chiromo said the group would continue investing in operational efficiency while strengthening the resilience of its dairy supply chain.
“We continue to focus on reducing our environmental footprint through improved energy and water efficiency, responsible waste management and recycling, while investing in the resilience and development of dairy farmers who are critical to our raw milk supply,” he said.
The emphasis on farmers is commercially important. Sustained growth in liquid milk and dairy products ultimately depends on Dairibord securing adequate raw milk supplies to utilise its expanded processing capacity.
Stronger earnings outlook
The first-half performance provides Dairibord with a stronger platform for the remainder of the financial year, although the company continues to face the competing demands of funding expansion, securing agricultural inputs and managing finance costs.
The sharp improvement in operating profit suggests that volume growth is beginning to translate into meaningful operating leverage. However, the 30% decline in exports highlights the trade-off created by prioritising the domestic market.
From an equity-market perspective, the key variables for the second half will be whether Dairibord can sustain volume momentum, secure sufficient raw milk, preserve gross margins and convert its expanded production capacity into stronger cash generation.
With revenue already up 28% and operating profit more than doubling in the first six months, the group enters the second half with considerably stronger operating momentum than a year earlier.
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