Zimpapers records 14,6pc jump in operating profit
THE country’s largest media house recorded a 14,6 percent increase in operating profit before tax for the year ended 31 December 2016 on the back of a reduction in operating costs and borrowings.
Profit after tax for the group for the period under review rose to $2,5 million from $2,1 million in the previous year while operating costs fell by 23,5 percent to $21,8 million from $28,4 million in 2015.
Zimpapers chairman Mr Delma Lupepe attributed the drop in operating costs to a number of cost cutting initiatives that were implemented by the group.
“The country continued to make notable steps on its various cost reduction initiatives. The optimisation of the company’s cost base remains a key focus area in the period ahead,” he said.
The group also reduced its borrowing by 37,4 percent to $4,3 million during the period under review.
However, the group’s revenue took a slight knock declining 6,3 percent to $37,6 million during the period under review largely due to the tight liquidity situation in the country.
“The decrease in revenue was caused by liquidity constraints that affected customers’ disposable incomes,” he said.
Resultantly gross profit for the period fell to $24,6 million from $29,9 million while profit after tax was lower at $2,02 million from $2,7 million in 2015.
In terms of operations the broadcasting and commercial printing divisions recorded growth in both revenue and operating profits while the newspaper division recorded slight decreases as result of a high fixed cost structure.
The commercial printing division recorded an operating profit of $0,4 million from $0,3 million in 2015 while the broadcasting division’s revenue was up 27,3 percent to $4,3 million as it rode on reputable brands. Its operating profit came in at $0,5 million up from $0,2 million in 2015.
The newspaper division’s revenue fell to $29,2 million from $33,1 million in 2015 while net profit was lower at $2,6 million compared to $3,6 million in the prior period. Mr Lupepe said the group will continue to push its Digital First Strategy as it continues to embrace the change that the digital revolution has brought to the media industry. “A good number of our readers have migrated to digital platforms and it is our mandate to continue providing them with the same quality content they previously enjoyed in our print platforms. As a company we commit to investing more in the digital space because we believe that we will continue to discover new possibilities that will help our business grow stronger in this digital age,” he said. — Online