Schweppes Zimbabwe Limited, which is still assessing the impact of the global sale of Schweppes brands to Coca Cola outside the United States, France and South Africa, had satisfactory results for the year ending January 2, 1999 which saw turnover increase by 44.7 percent from $194 million to $280.8 million and net profit increase by 51.2 percent from $15.6 million to $23.5 million.
The company which just ended a 10-year franchise agreement with Delta Operations and Mutare Bottling Company was widely believed to be planning to re-launch Pepsi products thus offering competition to Delta which dominates the beverage industry as it controls the bottled and canned soft drinks as well as the clear and opaque beer business.
Despite the pleasing results Schweppes says the outlook for the country’s economy is once again uncertain and is now dependent upon the government’s ability to stabilise the currency and control inflation.
While the country has so far managed to stabilise the dollar, it has not managed to stabilise inflation. Although the rate of inflation dropped from 46.6 percent in December to 44.2 percent in January, the first decline in three months, but with food prices continuing to soar, the rate of inflation is expected to be above 30 percent by the end of the year.
Reserve Bank governor, Leonard Tsumba, has even suggested that a law which sets the maximum rate of inflation should be introduced, a move that has been supported by the business sector.
Schweppes says disposable incomes need to be regenerated to provide for market growth. Although there is some promise for a successful agricultural season following above normal rains, the company foresees limited opportunities for volume growth in the next six months.