Zimplow in worst loss in 4 months

HARARE — Farm implements manufacturer, Zimplow Holdings Ltd (Zimplow)’s operating loss for the first four months of the year worsened to $1,68 million from a loss of $1,24 million during the same period last year. Group CEO Mr Mark Hulett told the company’s shareholders yesterday that the depressed performance was due to a decline in revenues during the period under review as most of the firm’s Strategic Business Units (SBUs) recorded lower business during the period.

“The drought has weakened demand in the region and the late start of the tobacco marketing season led to our revenues falling by 40 percent to $4,6 million from $7,7 million which was achieved the same period last year.

“With a generally subdued performance in volumes the group’s operating loss for the four months increased by 36 percent to a loss of $1,68 million from a loss of $1,24 million during the same period last year,” said Mr Hullet.

In terms of the respective performances of Zimplow’s SBUs during the period under review, the CEO said Farmec was affected by the delay in the opening of the auction floors, the drought and the fact that the big tobacco companies are not giving capex to growers this year.

As a result of this volumes for Farmec were down 40 percent compared to the same period last year. In respect of the future prospects of the Farmec business Mr Hullet said a number of strategies already in place would put the business in good stead as the year proceeds.

“Despite the poor performance we have got some turnaround strategies; firstly the renewal of the Massey Ferguson dealership for the next five years as new management in the group reviewed that the idea is a positive idea for the group going forward. Secondly the more food programme is moving positively, this is the programme between the Government and the Brazilian government,” he said.

He added that the appointment of the new Massey Ferguson qualified parts and service manager to the Zimplow head office is a positive move.

“The centralisation of operations which reduce costs and increase efficiencies in the business all of these strategies will play a big role in our turn around strategies which we believe will bring positive results in the second half.

The generator power business recorded a significant drop in volumes during the first four months, largely due to the fact that electricity supply has unexpectedly stabilised to April 2016. — BH24