Good rains, Govt support spur Zimplow
ZIMBABWE Stock Exchange (ZSE)-listed agro-industrial group, Zimplow’s revenue grew by 65 percent from $24,1 million in 2016 to $39 million in the year ended 31 December 2017.
The group’s financial results for the period show after tax profit of $3,4 million was realised, up from a loss of $2,5 million in the previous year. Chairman, Mr Thomas Chataika said improvement was a result of good rains, which the country received last year and supportive Government policies.
He said the company clinched profitability also as a result of measures implemented over the past three years, which include settling expensive debts, cost cutting and restructuring among other measures.
“The year 2017 was important for the Zimplow Group with all our businesses returning to profitability. This was on the back of good rainfall season, supportive Government as well as good internal strategy execution,” said Mr Chataika.
“The group’s turnover rose by 60 percent to $38,8 million resulting in a profit after tax of $3,4 million, which was a huge swing from last year’s loss of $2,5 million.”
Zimplow’s top performer was its Bulawayobased agriculture implements manufacturer, which posted a turnover of up to 114 percent from $5,6 in 2016 to $11,9m. The group runs the Mealie Brand, Farmec, Powermec, CT Bolts and Barzem units under its wing. Mealie Brand reportedly increased its capacity utilisation from 50 percent to 80 percent on the back of a good agricultural season the country experienced last year.
“GP margins went up by 18 percent as a result of factory efficiencies. Pleasingly operating expenses were down 17 percent as we maintained our focus on costs expanding operating margins. The business achieved an operating profit of $2,96m, which was a massive swing from last year’s loss of $771 000. The strong return to profitability was mainly on the back of the 100 percent in exports as well as a 57 percent increase in local volumes,” Mr Chataika said.
The Barzem unit’s revenue went up by 35 percent from $8,8million to $11 million while Farmec’s rose by 61 percent from $6,9 million to $11,1 during the year under review. Powermec sales were up by 55 percent while CT Bolts increased nails sales by 49 percent. Zimplow has placed its hopes on the new political administration saying it anticipates increased volumes as the new Government is working on reviving the mining, agricultural and infrastructure sectors, which is the company’s stronghold. — @PrinceNkosy102.