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Key Points:
- Sefalana Group achieved P9.7 billion ($716 million) in revenue for 2023/24, with Botswana contributing P5.2 billion ($384 million).
- Sefalana’s Botswana operations generated P306 million ($22 million) profit before tax, led by 125 retail stores and a strong manufacturing division.
- International operations also increased, with Namibia contributing P101.6 million ($8million) in profit before tax, followed by Lesotho, Zambia, and Australia.
Sefalana Holding Company, a leading retail conglomerate led by Botswana retail tycoon Chandra Chauhan, has once again demonstrated its strength across various sectors and countries, delivering impressive results for the financial year 2023-2024, covering April to March.
The retail giant reported a revenue of P9.7 billion ($716 million), with Botswana standing out as the major contributor, generating P5.2 billion ($384 million).
Sefalana’s Botswana stores dominate revenue growth
The group’s overall profits before tax were P442.8 million ($33 million) which reduced to P335.5 million ($25 million) after accounting for taxes.
In Botswana, Sefalana operates 125 retail stores, which constitute two-thirds of the group’s business. These stores include 56 liquor outlets, 34 Shopper stores, 25 cash-and-carry outlets, five convenience stores, four hypermarkets, and one catering outlet.
Together, these stores contributed P182.9 million ($13 million) in profit before tax. The group’s total profit before tax in Botswana amounted to P306 million ($22 million), bolstered by its diverse operations within the country.
Sefalana’s manufacturing division, particularly Foods Botswana, increased in earnings with P60.2 million ($5 million). This division, known for its Sechaba brand, produces sorghum and samp.
The company’s property sector contributed P54.9 million ($4 million), while its commercial motors and mechanized farming wing added P7.6 million ($560,836) to the overall profit.
Manufacturing and diversification drive Sefalana’s success
Beyond Botswana, Sefalana’s international operations also performed well. Namibia emerged as the second-largest contributor with P101.6 million ($8million) in profit before tax, followed by Lesotho with P20 million ($2 million), Zambia with P15.5 million ($1 million), and Australia with P3.1 million ($228,767).
On Tuesday, Sefalana Group’s Managing Director (MD), Chandra Chauhan, confirmed the company’s financial results for the year. He highlighted the group’s investments in inventory to mitigate supply constraints, ensuring a consistent product offering for customers.
Chauhan noted that the company had managed to reduce stock-outs, despite numerous price increases from suppliers in South Africa over the past 18 months. To counter these increases, Sefalana accelerated procurement in certain commodities.
“Our focus has been on diversification into a wider product range and service offerings to ensure our customers receive the best value. We also prioritize supporting local producers with favorable trading terms and opportunities, providing entrepreneurs with a reliable and sustainable customer base,” said Chauhan.
The managing director expressed particular satisfaction with the performance of Foods Botswana, the group’s manufacturing unit, which continues to grow. This unit is largely dependent on government orders for various feeding schemes and the availability of raw materials. Chauhan anticipates increased government spending in this area next year, following the extension of drought relief feeding schemes.
“We have procured sufficient grain to fulfill all orders placed with us and are prepared to cover any shortfall if other tenderers fail to meet their obligations. We remain committed to manufacturing and supplying additional orders if required. Our focus remains on manufacturing branded products to maximize factory capacity and create further employment opportunities,” Chauhan added.
However, the beverages division faced challenges, particularly in the supply of milk to the government for children’s feeding schemes. The repeated outbreaks of Foot and Mouth Disease in South Africa over the past 24 months led to a shortage of raw milk, impacting production output.
To address this, Sefalana implemented measures to import pasteurized milk into Botswana, despite it being more expensive than raw milk. This strategy allowed for a more regular supply, securing sufficient volumes to meet approximately 80 percent of the division’s target production levels.
“We have been able to navigate these challenges effectively and continue to work towards stabilizing our supply chains and meeting our production goals,” concluded Chauhan.
The leading retail conglomerate under Chauhan, announced its most lucrative full-year dividend ever, setting a new benchmark in its financial achievements a few weeks ago. The group declared a substantial dividend of 65 thebe per share, following a year marked by great performance despite numerous industry challenges.
