National Foods upbeat after VFEX listing

NEWLY-listed Victoria Falls Stock Exchange (VFEX) counter, National Foods (NatFoods), says it remains positive on Zimbabwe’s economic outlook as it targets investments totalling US$30 million by year-end.
According to company chairman, Todd Moyo, the investments will go towards both new and existing projects.
“Over the course of 2022 and into 2023, a total of US$30 million will be invested, with some of the key investments including… a new and much more efficient flour mill… installed in Bulawayo, to replace existing equipment with a state-of-the-art flour mill supplied by the Buhler company from Switzerland,” Moyo said after the company’s recent listing ceremony in Victoria Falls.

National Foods is one of the key companies in the agro-processing zone where, through alliances with other like-minded corporates, it is heavily involved in the support of both contract and corporate farming initiatives in the country.

“A breakfast cereal plant in Harare will see the production of a range of instant breakfast cereals as well as corn flakes, bran flakes and wholegrain flakes. These products were released to the market late in 2022 and so far, have been very well received by consumers.”
Moyo said in line with the import substitution drive under the National Development Strategy 1, the company would invest in a new pasta plant at its Stirling Road plant in Harare.
“This will be the first large scale pasta line in the country and seeks to cater for the needs of our consumers who are increasingly looking for a wider variety of food options.
“A biscuit plant, again at our Stirling Road site in Harare and another import substitution initiative, will produce a wide range of quality biscuits, extending our offering from the current basic Iris biscuit range to a broader range of products such as cookies and creams,” Moyo said.
“Finally, significant investment is being made in upgrading our Aspindale stockfeeds plant, with a view to improving efficiency and product handling, which ultimately will benefit livestock farmers.”
He said these investments would be beneficial to Zimbabwe in a number of ways.
“Firstly, and as already mentioned, many of these investments will see the localised manufacture of products that were previously imported; secondly, we are offering our consumers a wider range of quality and healthy food products, manufactured locally to globally benchmarked quality standards. Thirdly, the increased capacity and raw material demand will result in increased support to our local farmers. Finally, increased industrialisation will see job creation, not only at National Foods but in ancillary industries as well,” Moyo said.
National Foods is one of the key companies in the agro-processing zone where, through alliances with other like-minded corporates, it is heavily involved in the support of both contract and corporate farming initiatives in the country.
It listed on the Zimbabwe Stock Exchange (ZSE) in 1975, and says its move to VFEX was taken after careful thought and consideration.
“(It) will unlock value to both local and foreign shareholders. Although our current focus is to capitalise on the many opportunities we see on the local market, we believe that our presence on the VFEX will facilitate easier access to possible regional opportunities in the long term,” Moyo said.
In a statement last December, NatFoods said it was keen on the move to VFEX because of lower trading costs, tax incentives, and lower valuation volatility, among other benefits.
“The VFEX’s lower trading costs of 2,12 percent compared to 4,63 percent on the ZSE is more efficient for shareholders.
“The ability to trade shares in US$ will potentially make the share attractive to a broader set of investors.
“The VFEX offers tax incentives for shareholders, which include a five percent withholding tax on dividends and no capital gains tax on share disposal. Shareholders would thus retain more of their earnings compared to the ZSE.
“Provision of a de facto third-party US$ valuation of the company will enable NatFoods’ existing shareholders to realise the real value of their holdings and provide a more accurate benchmark of the stock’s performance and mitigate valuation volatility,” the company said.
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