Published: 18 September 2013

FINANCIAL analysts foresee dairy processor Dairibord Holdings' revenue remaining almost flat around $108 million this year following slow growth in its top line during the first half of its financial year.

Inter Horizon Securities in its latest Dairibord half year earnings update believe the group might only manage a marginal 1,7 percent growth in revenue after constrained first half due to costs of restructuring.

But Dairibord has already seen some improvement in operating costs in July and August post the rationalisation exercise, which has reduced its wage bill. After a 6 percent wage increase awarded in 2013, it is expected that going into 2014 further increments will be more subdued.

"We now downgrade our previous growth forecasts given a highly constrained first half performance.

We estimate that 2013 revenue will be relatively flat at $1087 million, up just 1,7 percent year on year," IH Securities said.

IH Securities said they estimate some earnings before interest tax recovery to 3 percent, yielding lower EBITDA of $6,3 million in 2013 against $12,1 million in 2012 and profit after tax to close the year at $2,1million against $7,1 million in prior comparative period.

The financial analysts see the stock, with a $68 million market capitalization on the Zimbabwe Stock Exchange, fully valued at US17c.
- bh24

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