LAGER BEER BUSINESS
Lager beer volume was 7% below prior year as the category continued to decline from the historical peak of 2,0 million hectolitres achieved in the year to March 2013. There is some slowdown in the rate of decline, with brands such as Zambezi Premium Lager and Castle Lite registering growth in the current year.The sales performance was largely constrained by the prevailing macroeconomic factors, the down trading to affordable offerings and opportunistic imports. Our brands continue to collectively appeal to a wide cross section of consumers and command leading positions in the repertoire of Zimbabwean drinkers. The total market share has remained stable at above 95% of the lager beer category.
LAGER BEER TRADE CHANNEL
SALES % CONTRIBUTION
Manufacturing throughput was stable despite intermittent utilities outages. There were pronounced water supply disruptions during the period September to December 2016 whose impact was mitigated by higher finished product stock covers. The decline in volume negatively impacted capacity utilisation and production efficiency.
Our full brand and pack offerings continue to attract consumer attention through merchandising, upgraded labels, branded merchandise and various consumer promotions.
The Company continues to focus on marketing efforts in maintaining consumers within its franchise. Our mainstream brand line-up comprising Castle Lager, Carling Black Label and Lion Lager constitutes the bulk of our sales and dominates the lager beer category. These marketing activities promote consumer closeness, bonding, social development and outright pride in our country.
Castle Lager, our flagship brand’s essence is to be the bonding benchmark in all consumption occasions. It is the beer brand that brings people together for a better world as it boldly declares: “It all comes together with a Castle!!
OUR BRANDS IN THE COMMUNITY
The Company remains committed to the development of sport and the arts through various brand sponsorships as it endeavours to connect its brands with both its consumers and the communities.
Soccer remains Zimbabwe’s premier sport hence brand Castle Lager has renewed its Premier Soccer League sponsorship for another three years, an investment of over one million dollars per year in Sponsorship and supporting activities.
Castle Lager brought consumers together for a worthy cause at the maiden Castle Lager Braai Day at Alexander Sports Club on 29 October 2016. The event saw consumers coming out to enjoy good music, braai and some cold Castle Lagers. Through this event, the brand will donate a year’s supply of meat to the country’s two biggest referral hospitals – Harare Hospital and Mpilo Hospital in Bulawayo.
Carling Black Label sponsors the National Pool tournament, a sport that has a rising following.
Zambezi Lager focuses on consumers eager to follow the call to embrace Zimbabwe’s great outdoor life. It remains the official beer for Kariba Invitational Tiger Fishing Tournament and the Victoria Falls Carnival, platforms that support tourism in Zimbabwe.
Castle Lite is a brand with a passionate purpose to unlock extraordinary enjoyment. The brand’s modern, fun and innovative personality makes it an obvious choice for the guy who is going places on a mission to improve his life. Castle Lite continued to bring new experiences to consumers and held two events – Castle Lite Extra Cold Block Party in Bulawayo and a New Year’s event at Westgate Mall in Harare.
BOOSTING COMMUNITIES THROUGH LOCAL INGREDIENTS
SORGHUM FOR EAGLE LAGER. Eagle Lager connects with Zimbabwe’s rural small-scale farmers who grow sorghum, its key brewing ingredient .While empowering rural farmers on the one hand, Eagle Lager provides consumers with a quality refreshing beer with an unbeatable value for money proposition.
A SMART BARLEY PARTNERSHIP. The Company resumed barley contracting this year after skipping 2015 due to excess stocks carried over from previous seasons. A total of 10 063 tons were delivered from the 2016 scheme. The improvement in yields is attributed to better crop husbandry, stable water and power supplies.
A total of 2 300 hectares have been contracted for the 2017 season. This should deliver sufficient barley for our needs. Of concern are the very high wheat prices offered by the Command Agriculture project as this competes with barley for winter irrigation capacity.
The price distortions may potentially cause disharmony with our farmers as we focus on reduced costs and increased productivity targeting regional parity pricing.