The Meat Corporation of Namibia (Meatco) recorded a N$118-million loss for the period 1 February 2022 to 31 January 2023, with auditors Grand Namibia warning that the company’s ability to continue operating as a going concern will depend on continuous government support.
During the period under review, the Government issued a guarantee in favour of the Development Bank of Namibia (DBN) for the meat processor to obtain funding amounting to N$200 million, an amount which was disbursed to Meatco at the end of July 2022.
The government will repay the N$200 million to DBN on behalf of Meatco semi-annually through budgetary provisions, commencing on 31 July 2023 and every sixth month thereafter, while Meatco will be responsible for the interest.
Meatco’s long-term debt, according to its latest figures, consists of three loans from the Development Bank of Namibia (DBN), DBN Loan 1 has an outstanding balance of N$151 million, and DBN Loan 2 has an outstanding balance of N $306 million and DBN Loan 3 with an outstanding balance of N$213 million.
Meatco’s business model, according to the company, is profitable at an average of 5,500 slaughtered cattle per month or 66,000 slaughtered cattle per year, based on the slaughter capacity of the Windhoek Abattoir which is set at 120,000 cattle per annum.
However, during the period under review, the company’s “Livestock Procurement and Production Department struggled to procure slaughter cattle to meet the budgeted number of 60,000 for the reporting year.”
The company, however, generated N$865 million in revenue for the period, an increase from N$752 million the prior year, with international sales generating N$563.8 million of the amount.
“Accordingly, the EU generated 25% of total revenue, South Africa 11%, Norway 27% and China/Asia 11%,” the company’s annual report noted.
During the 2023 financial year, Meatco paid N$560 million to producers to protect primary livestock production in the national interest of Namibia, an increase from N$492 million.
Meatco Northern Communal Area (NCA) generated total revenue of N$60,5 million against the budget of N$99,6 million.
As at January 2023 year to date, Meatco NCA slaughtered 3,814 cattle against a budget of 9,167, resulting in 5,353 cattle under budget.
