Nutritional Holdings reports strong growth in tough market
Nutritional Holdings reported positive earnings results for the year ended 29 February 2020. Reporting a growth of over 180 per cent, CNBC Africa's Zinathi Gquma spoke to Mohammad Azum, CEO of Nutritional Holdings to unpack some of the challenges faced - especially considering the closure of schools hurting the supply of dry food products to feeding schemes.
Tue, 15 Sep 2020 14:22:59 GMT
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AI Generated Summary
- Strategic Diversification and Innovation: Azum implemented a strategic shift in focus towards the cannabis industry, driving growth and resilience amidst market challenges, particularly during the COVID-19 pandemic.
- Cost Optimization and Debt Reduction: Nutritional Holdings optimized administrative costs and made strategic cuts to offset debt, enhancing cash flow and positioning the company for sustainable growth.
- Expansion and Future Prospects: The company is actively pursuing acquisitions, partnerships, and innovative product development to strengthen its market presence and drive significant turnover growth in the near future.
Nutritional Holdings has reported positive earnings results for the year ending on February 29, 2020, showing a remarkable growth of over 180 percent. CNBC Africa's Zinathi Gquma recently interviewed Mohammad Azum, the CEO of Nutritional Holdings, to delve into the company's success amidst a tough market and the challenges they have faced. Azum discussed the strategic changes he implemented upon taking over the company, focusing on diversification and innovation to drive growth despite market challenges, especially with the closure of schools affecting the supply of dry food products to feeding schemes.
Upon assuming leadership at Nutritional Holdings, Azum made strategic decisions to divide the company into two divisions. While one division continued to focus on traditional food products such as instant meals and rehydration items, Azum saw an opportunity for growth in the cannabis industry. By shifting the company's focus, Nutritional Holdings was able to achieve remarkable results, particularly during the challenging COVID-19 period when school closures disrupted the food business supply chain.
One of the key measures Azum took to lower administrative costs and offset the company's debt was to streamline operations and make strategic cuts in expenditure. This included reducing costs related to office space, vehicles, and other overhead expenses. By optimizing resources and expenditures, Nutritional Holdings was able to enhance cash flow and drive the business towards sustainability and profitability.
Despite the ease in restrictions post-COVID-19 lockdowns, the company faced challenges due to fluctuating school attendance and tight consumer budgets. The closure of schools significantly impacted the supply of food products to key markets. However, Nutritional Holdings found resilience in its strategic shift towards the cannabis sector, with a focus on immune-boosting products. The company's collaboration with Cicela led to the development of unique products that not only bolstered immunity but also opened new international market opportunities, reflecting the company's growth potential.
In terms of future growth and expansion, Nutritional Holdings is actively pursuing acquisitions and innovations to strengthen its position in the market. The acquisition of Occecela showcased the company's commitment to strategic partnerships and product development. Azum hinted at potential new acquisitions and partnerships in the pipeline, particularly in expanding the company's presence in the international food market. By leveraging existing brands and exploring innovative product lines, Nutritional Holdings aims to increase its turnover significantly in the next financial year, projecting a growth trajectory that signals a promising future for the company.
Looking ahead, Azum outlined a comprehensive action plan to sustain and elevate the company's success. The strategy involves a focus on diversification, with a 70-30 split between food products and the burgeoning cannabis industry. Additionally, Nutritional Holdings is venturing into pet care and developing CBD-infused products to cater to a diverse consumer base. The company's commitment to product testing, particularly in hospitals with terminally ill patients, reflects its dedication to delivering high-quality, innovative solutions.
Furthermore, Nutritional Holdings is set to roll out kiosks nationwide and expand its medicinal cannabis offerings through partnerships like Kerala. By scaling up its presence and product range, the company aims to solidify its position in the market and drive growth in the coming years.