Managing Director of Desnoes and Geddes (D&G), Ricardo Nuncio says the use of Cassava in the company’s brewing process will become cost effective by the end of 2019.

Speaking to Businessuite Magazine following the company’s Annual General Meeting last week, Nuncio indicated that despite the company’s investment in Project Grow, the cassava cultivation programme, the use of the local produce in beer production is not cost effective at this time.

Currently, the use of cassava in the brewing of Red Strip is 5%. However, Nuncio says this number should be increased to 10% by the end of this year. He says the break-even point is at 20%, a figure which the company aims to achieve by 2018. Furthermore, the managing director says by the end of 2019, use of cassava should become cost effective at 40%.

Nuncio says achieving this goal however will require additional investment in the company’s root ton plant. He says over the past 3 years, D&G has invested US$4 million and plans are in place to invest another US$10million by 2019.

The Managing Director says this investment will go towards a new facility, acquiring more land, training farmers and the initiation kit for small farmers.

For the six month period ended December 2015, D&G reported net profits of $1,581 million, a 37% increase in profit after tax compared to the similar period in 2014. This report represents the final public Annual report on the company which delisted from the JSE with effect from March 31, 2016.
Nuncio says the results for the period are due to the ‘unwavering support of customers and shareholders’. He says as the company enters its next phase of growth, he looks forward to continued support from shareholders, as the company attempts to drive domestic growth and widen the distribution of key brands.