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Fradreck Gorwe
Zimbabwe Stock Exchange listed tyre manufacturing and retailing concern, National Tyre Services, recorded a 37 percent volumes fall for the third quarter to December 31, 2019 as compared to overall volumes performance in the prior comparable period.

The company is also into tyre retreading, wheel alignment, wheel balancing and other related services offered through its fourteen branches.

Volumes decline was attributed to a combination of constraints that inflicted tyre production and product demand.

These included power outages, foreign currency scarcity and local currency depreciation.

“Power outages continued to affect operations although the impact varied depending on location. Shortage of foreign currency persisted, whilst fuel supplies remained constrained.

“The economic environment remained difficult with the local currency continuing to loose purchasing power, thus leading to a weak aggregate demand in the economy.”

“Overall volumes decreased by 37 percent when compared to the corresponding quarter in the prior period.

“Foreign currency constraints, as already alluded to, power outages and dwindling incomes were the main factors which contributed to the decline,” said company secretary Stewart Mandimika in a trading update.

Sales volumes for new tyres had fallen by 63 percent compared to prior year owing to “limited availability of foreign currency, particularly in the banking sector, to import stock.”

Services volumes decreased by 32 percent compared to the same period last year on the back of power outages that frequently disturbed machinery operations.

Positives, however, were recorded in retreading volumes and repairs.

Retreading volumes boosted by 11 percent on prior year on the back of strong demand from customers. Tyre repairs also went up by 5 percent compared to prior year in line with retreading performance.

The group’s outlook is hinged on the success of the ongoing phased programme to upgrade branch image and services.

Increased demand for products and services is highly expected going forward.