• Export volumes fell 30% while total sales volumes rose 26%
• Domestic demand absorbed most of Dairibord’s additional production
• South African revenue grew 38% from a small base

Harare - Dairibord Holdings has recorded a 30% decline in export volumes during the six months to June 2026 as stronger domestic demand absorbed more of the company’s production.

The decline was attributed  to prioritisation of domestic demand, allowing allocation of  a greater share of available production towards a market already producing strong volume growth and improved profitability.

This came during a period of substantial overall expansion. Consolidated sales volumes increased 26% to 78.27 million litres while revenue rose 28% to US$82.56 million. Attributable profit increased 169% to US$3.25 million.

The operating numbers show that Dairibord found sufficient demand inside Zimbabwe to absorb higher production while maintaining stronger earnings conversion.

The pattern extends beyond the latest reporting period. Dairibord had already reduced the export contribution to overall volumes during 2025 as local demand strengthened. Export volumes then contracted sharply during the first quarter of 2026 before the rate of decline moderated to 30% over the full half year.

That progression places production capacity at the centre of Dairibord’s regional strategy.Additional volumes can be directed towards a domestic market currently absorbing more product. Regional markets require sufficient production headroom to preserve local availability while building distribution and customer demand outside Zimbabwe.

South Africa provides the clearest current measure of that expansion. Revenue from the market increased 38% to about US$722 000 during the period. The growth rate is strong from a small base and leaves South Africa contributing below 1% of Dairibord’s group revenue.

The absolute contribution establishes the distance between Dairibord’s current regional footprint and the scale of its domestic business.

Zimbabwe therefore remains the primary earnings engine. That concentration has produced a strong first half. Higher sales volumes have been converted into faster EBITDA and profit growth while local demand has accommodated additional production.

Dairibord’s longer term regional ambitions depend on whether increased manufacturing capacity creates enough volume to develop foreign markets alongside that domestic growth.

The company has previously identified Southern African markets as part of its expansion strategy. Geographic diversification can widen the customer base and introduce additional foreign currency revenue across economies carrying different demand cycles.

The first half shows that this diversification is still at an early stage. A 30% decline in export volumes means Dairibord’s strongest recent corporate growth has been generated primarily inside Zimbabwe. South African revenue is expanding, though its present contribution remains too small to materially alter the group’s geographic earnings concentration.

The relationship becomes important as Dairibord continues expanding output. A larger production base can deepen local market penetration and create volumes for export. The economic return on that capacity will increasingly depend on how much additional demand the company can capture without weakening the margins already being generated at home.

The first half establishes a favourable domestic benchmark.Revenue increased broadly in line with volumes while EBITDA grew significantly faster. Dairibord therefore retained a greater share of revenue at operating earnings level during the period.

Regional expansion will eventually have to meet a similar economic standard. Additional export sales need to carry distribution, logistics and market development costs while generating sufficient margin to justify allocating production outside Zimbabwe. Rapid export growth that weakens earnings conversion would add geographic reach with limited economic value.

South Africa becomes useful as an execution marker because the market is already growing from Dairibord’s existing base. A sustained increase in South African revenue alongside recovery in total export volumes would show that additional manufacturing capacity is beginning to widen the company’s geographic reach. Continued export contraction would show that domestic demand remains the dominant destination for incremental production.

The current earnings profile gives management time to build that regional position from a stronger operating base.

Dairibord has already demonstrated that Zimbabwe can absorb substantially higher volumes. The company has also converted that demand into improved margins and profitability.

The next stage lies in determining whether the same production expansion can support meaningful regional scale. Second half export volumes and South African revenue will provide the clearest evidence. Their movement will show whether Dairibord’s expanding capacity is beginning to diversify the business geographically or continuing to deepen its dependence on Zimbabwean demand.

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